The Commonwealth Company uses a job-order costing system and applies manufacturing overhead costs to jobs using a predetermined overhead rate based on the cost of materials used in production. At the beginning of the year, the following estimates were made as a basis for computing the predetermined overhead rate: manufacturing overhead cost, $186,000; direct materials cost, $155,000. The following transactions took place during the year (all purchases and services were acquired on account):

a. Raw materials purchased, $96,000.

b. Raw materials requisitioned for use in production (all direct materials), $88,000.

c. Utility bills incurred in the factory, &17,000.

d. Costs for salaries and wages incurred are as follows:

Direct labor: $174,000

Indirect labor: $70,000

Selling & Administrative salaries: $124,000

e. Maintenance costs incurred in the factory, $12,000.

f. Advertising costs incurred, $98,000.

g. Depreciation recorded for the year, $75,000 (75% relates to factory assets and the remainder relates to selling, general, and administrative assets).

h. Rental costs incurred on buildings, $80,000 (80% of the space is occupied by the factory and 20% is occupied by sales and administration).

i. Miscellaneous selling, general, and administrative costs incurred, $12,000.

j. Manufacturing overhead costs was applied to the jobs.

k. Cost of goods manufactured for the year, $480,000.

l. Sales for the year (all on account) totaled $900,000. These goods cost $550,000 to manufacture.

Required: Prepare the necessary T-accounts and record the beginning balances and each of the transactions listed above. Also, determine the ending balances. In addition, prepare the journal entries to record the information above. Indicate your entries by the letters a. through l.

Answer rating: 100% (QA)

ANSWER Journal Entries for the above information a Raw Materials ac 96000 Accounts Payable a... View the full answer