Reference no: EM132664852

The following transactions occurred in January at Apex Manufacturing, a custom parts supplier. Apex uses job costing.

1. Purchased $54,400 in materials on account.
2. Issued $2,200 in supplies from the materials inventory to the production department. 
3. Paid for the materials purchased in transaction (1). 
4. Issued $26,200 in direct materials to the production department. 
5. Incurred wage costs of $49,000, which were debited to Payroll, a temporary account. Of this amount, $14,200 was withheld for payroll taxes and credited to Payroll Taxes Payable. The remaining $34,800 was paid in cash to the employees. See transactions (6) and (7) for additional information about Payroll. 
6. Recognized $28,000 in fringe benefit costs, incurred as a result of the wages paid in (5). This $28,000 was debited to Payroll and credited to Fringe Benefits Payable. 
7. Analyzed the Payroll account and determined that 70 percent represented direct labor; 20 percent, indirect manufacturing labor; and 10 percent, administrative and marketing costs. 
8. Paid for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing plant totaling $33,100. 
9. Applied overhead on the basis of 150 percent of direct labor costs. 
10. Recognized depreciation of $17,950 on manufacturing property, plant, and equipment.

Required:

Problem a. Prepare journal entries to record these transactions.

Problem b. The balances that appeared in the accounts of Apex Manufacturing are shown as follows.

                                                     Beginning                     Ending

Materials Inventory                           $ 56,625                           -

Work-in-Process Inventory                     13,425                           -

Finished Goods Inventory                        62,950                         $ 51,200

Cost of Goods Sold                                   -                           102,275

Prepare T-accounts to show the flow of costs during the period.