Answer:
Forest Components
Journal Entries:
1. Debit Materials Inventory $16,950
Credit Accounts Payable $16,950
To record the purchase of materials on account.
2. Debit Work in Process Inventory $16,780
Credit Materials Inventory $16,780
To record the issue of materials to the production department.
3. Debit Manufacturing Overhead $1,340
Credit Materials Inventory $1,340
To record the issue of materials to the service department.
4. Debit Accounts Payable $16,950
Credit Cash Account $16,950
To record the payment for the materials purchased on account.
5. Debit Materials Inventory $2,020
Credit Work In Process $2,020
To record the record of materials.
6. Debit Work in Process $32,500
Credit Factory Wages $32,500
To record the direct labor cost.
7. Debit Manufacturing Overhead $17,250
Credit Accounts Payable $17,250
To record the purchase of miscellaneous items for the plant.
8. Debit Manufacturing Overhead $36,700
Credit Depreciation Expense $36,700
To record depreciation expense on manufacturing plant.
9. Debit Work In Process $30,875
Credit Manufacturing Overhead $30,875
To apply overhead for the month.
b. T-accounts:
Materials Inventory
Accounts Titles         Debit    Credit
Balance                    $12,320
Accounts Payable   $14,930
Work in Process         2,020
Work in Process Inventory    $16,780
Balance                                  $12,490
Work-in-Process Inventory
Accounts Titles         Debit    Credit
Balance                    $11,755
Materials Inventory   16,780
Materials Inventory                $2,020
Factory Wages        32,500
Overhead                30,875
Finished Goods Inventory    79,330
Balance                                  10,560
Manufacturing Overhead
Accounts Titles                 Debit    Credit
Materials Inventory         $1,340
Accounts Payable           17,250
Depreciation Expense   36,700
Work In Process                         $30,875
Finished Goods Inventory
Accounts Titles         Debit    Credit
Balance                   $2,700
Work in Process     79,330
Cost of goods sold                75,100
Balance                                 $6,930
Cost of Goods Sold
Accounts Titles         Debit    Credit
Finished Goods      75,100
Explanation:
a) Data and Calculations:
Materials Inventory                 ?         $12,490
Work-in-Process Inventory     ?           10,560
Finished Goods Inventory $2,700       6,930
Cost of Goods Sold                ?         75,1000
Predetermined overhead rate = $412,870/$434,600 = $0.95
Overhead applied = $30,875 ($0.95 * $32,500)