Custom Cabinetry has one job in process $($Job $120)$ as of June $30$; at that time, its job cost sheet reports direct materials of $$7,300,$ direct labor of $$3,800,$ and applied overhead of $$3,040.$ Custom Cabinetry applies overhead at the rate of $80\%$ of direct labor cost. During July, Job $120$ is sold $($on account$)$ for $$25,500,$ Job $121$ is started and completed, and Job $122$ is started and still in process at the end of the month. Custom Cabinetry incurs the following costs during July.

July Product Costs Job $120$ Job $121$ Job $122$ Total

Direct materials $ $2,100$ $ $8,500$ $ $3,100$ $ $13,700$

Direct labor $3,1003,8003,90010,800$

Overhead applied $????$

$1.$ Prepare journal entries for the following in July.

Direct materials used in production.

Direct labor used in production.

Overhead applied.

The sale of Job $120.$

Cost of goods sold for Job $120.$

$2.$ Compute the July $31$ balances of the Work in Process Inventory and the Finished Goods Inventory accounts. $($Assume there are no jobs in Finished Goods Inventory as of June $30.)$

Answer rating: 100% (QA)

1 Journal entries for July a Direct materials used in production Work in Process Inventory 13700 Acc... View the full answer