Question

The following are the job cost related accounts for the law firm of Colaw Associates and their manufacturing equivalents: Law Firm Accounts Manufacturing Firm Accounts Supplies Raw Materials Salaries and Wages Payable Factory Labor Operating Overhead Manufacturing Overhead Service Contracts in Process Work in Process Cost of Completed Service Contracts Cost of Goods Sold Cost data for the month of March follow. 1. Purchased supplies on account $3,400. 2. Issued supplies $1,300 (60% direct and 40% indirect). 3. Assigned labor costs based on time cards for the month which indicated labor costs of $72,800 (80% direct and 20% indirect). 4. Operating overhead costs incurred for cash totaled $47,100. 5. Operating overhead is applied at a rate of 90% of direct labor cost. 6. Work completed totaled $79,400. (a) Your answer is partially correct. Try again. Journalize the transactions for March. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Account Titles and Explanation Debit Credit 1. 2. 3. 4. 5. 6. Click if you would like to Show Work for this question:

Answer 1

	Sl no.	Account titles and explanation				Debit	Credit
	1	Supplies				3400
		Accounts payable					3400
		(Purchased supplies on account)
	2	Service Contracts in Process			(1300*60%)	780
		Operating Overhead			(1300*40%)	520
		Supplies					1300
		(Issued supplies)
	3	Service Contracts in Process			(72800*80%)	58240
		Operating Overhead			(72800*20%)	14560
		Salaries and Wages Payable					72800
		(Assigned labor costs based on time cards)
	4	Operating Overhead				47100
		Cash					47100
		(Operating overhead costs incurred for cash)
	5	Service Contracts in Process			(58240*90%)	52416
		Operating Overhead					52416
		(Operating overhead is applied)
	6	Cost of Completed Service Contracts				79400
		Service Contracts in Process					79400
		(Work completed)