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Marcelino Co.'s March 31 inventory of raw materials is $88,000. Raw materials purchases in April are $560,000, and factory payroll cost in April is $379,000. Overhead costs incurred in April are: indirect materials, $50,000; indirect labor, $23,000; factory rent, $35,000; factory utilities, $22,000; and factory equipment depreciation, $60,000. The predetermined overhead rate is 50% of direct labor cost. Job 306 is sold for $670,000 cash in April. Costs of the three jobs worked on in April follow.

	Job 306				Job 307				Job 308
Balances on March 31
Direct materials		$	28,000			$	37,000
Direct labor			24,000				17,000
Applied overhead			12,000				8,500
Costs during April
Direct materials			131,000				205,000			$	115,000
Direct labor			102,000				154,000				100,000
Applied overhead			?				?				?
Status on April 30	Finished (sold)				Finished (unsold)					In process

1. Materials purchases (on credit).
2. Direct materials used in production.
3. Direct labor paid and assigned to Work in Process Inventory.
4. Indirect labor paid and assigned to Factory Overhead.
5. Overhead costs applied to Work in Process Inventory.
6. Actual overhead costs incurred, including indirect materials. (Factory rent and utilities are paid in cash.)
7. Transfer of Jobs 306 and 307 to Finished Goods Inventory.
8. Cost of goods sold for Job 306.
9. Revenue from the sale of Job 306.
10. Assignment of any underapplied or overapplied overhead to the Cost of Goods Sold account. (The amount is not material.)

2. Prepare journal entries for the month of April to record the above transactions.

Answer 1

Transaction	General Journal	Debit	Credit
a.	Raw Material Inventory	560,000
	Accounts Payable		560,000
b.	Work in process Inventory	451,000
	Raw material Inventory		451,000
c.	Work in process Inventory	356,000
	Cash		356,000
d.	Factory Overhead	23,000
	Cash		23,000
e.	Work in process Inventory	178,000
	Factory Overhead		178,000
f-1.	Factory Overhead	50,000
	Raw material Inventory		50,000
f-2.	Factory Overhead	22,000
	Cash		22,000
f-3.	Factory Overhead	60,000
	Accumulated Dep-Factory Equipment		60,000
f-4.	Factory Overhead	35,000
	Cash		35,000
g.	Finished Goods Inventory	846,500
	Work in process inventory		846,500
h.	Cost of goods sold	348,000
	Finished Goods inventory		348,000
i.	Cash	670,000
	Sales		670,000
j.	Cost of goods sold	12,000
	Factory Overhead		12,000