Quark Spy Equipment manufactures espionage equipment. Quark uses a job-order cost system and applies overhead to jobs the basis of direct labor-hours. For the current year, Quark estimated that it would work 100,000 direct labor-hours and incur $20,000,000 of manufacturing overhead cost. The following summarized information relates to January of the current year. The raw materials purchased include both direct and indirect materials.
|
Raw materials purchased on account
|
$1,412,000
|
|
Direct materials requisitioned into production
|
$1,299,500
|
|
Indirect materials requisitioned into production
|
$98,000
|
|
Direct labor cost (7,900 hours @ $40 per hour)
|
$316,000
|
|
Indirect labor cost (10,200 hours @ $16 per hour)
|
$163,200
|
|
Depreciation on the factory building
|
$190,500
|
|
Depreciation on the factory equipment
|
$890,700
|
|
Utilities for the factory
|
$79,600
|
|
Cost of jobs finished
|
$2,494,200
|
|
Cost of jobs sold
|
$2,380,000
|
|
Sales (all on account)
|
$3,570,000
|
Required:
Prepare journal entries to record Quark's transactions for the month of January. Do not close out the manufacturing overhead account.