Palmer-Travis Company's Factory Ledger Entries

Job Order Costing; General and Factory Ledger. On December 31, 19A, after closing, the ledgers of the Palmer-Travis Company contained these accounts and balances:
Cash $47,000 

Accounts Payable  $ 59,375
Accounts Receivable... 50,000 

Capital Stock 100,000
Materials* 22,000 

Retained Earnings 34,925
Work in Process* 7,500 

Factory Ledger 62,000
Finished Goods* 32,500 

General Ledger* 62,000
Machinery 35,300
* Maintained in the factory ledger. Details of the three inventories are
:
Materials inventory: Material A - 2,000 units @ $5.00= $10,000
Material B - 4,000 units @ 3.00                                 =12,000
Total                                                                          $22,000
Finished goods inventory: Item X - 1,000 units @ $12.50 =$12,500
Item Y - 2,000 units @ 10.00                                          =  20,000
Total                                                                                 $32,500
Work in process inventory: Job No. 101 Job No. 102
Direct materials:
500 units of A @ $5.00         $2,500
200 units of B @ 3.00             $ 600
Direct labor:
500 hours @ $4.00                 2,000
200 hours (« 5.00 1,000
Factory overhead applied at the rate of
$2.00 /hour 1.000 400
Total $5,500 $2,000

During January, 19B, these transactions were completed:
(a) Purchases on account: Material A, 10,000 units @. $5.20; Material B, 12,000 units @ $3.75; indirect materials amounting to $17,520.
(b) Payroll totaling $110,000 was paid. $20,000 of the total payroll was for marketing and administrative salaries. Payroll deductions consisted of $15,500 for federal income tax withheld and 6% for FICA tax.
(c) Payroll to be distributed as follows: Job No. 101, 5 000 direct labor hours @ $4 00- Job No 102, 8,000 direct labor hours (a $5,00; Job No. 103 6,000 direct' labor hours (g, $3.00; indirect labor, $12,000; "marketing and administrative salaries, $20,000. Employer's payroll taxes are: FICA tax, 6%, state unemployment insurance tax, 2.7%; federal unemployment insurance tax, .5%.

(d) Materials were issued on a fifo basis as follows: Material A 10,000 units (charged to Job No. 101); Material B, 12,000 units (charged to Job No. 02) Material A, 1,000 units, and Material B, 2,500 units (charged to Job No 103). (Note: Transactions to be taken in consecutive order.) Indirect materials
amounting to $7,520 were issued.
(e) Factory overhead was applied to Jobs No. 101, 102, and 103 based on a rate of $2 per direct labor hour.
(f) Jobs No. 101 and 102 were completed and sold on account for $120,000 and $135,000, respectively.
(g) After allowing a 5% cash discount, a net amount of $247,000 was collected on accounts receivable.
(h) Marketing and administrative expenses paid during the month amounted to $15 000 Miscellaneous factory overhead amountmg to $10,800 was paid and transferred to the factory. Depreciation on machinery was $2,000.
(i) Payments on account, other than payrolls paid, amounted to $85,000.
(j) Over- or underapplied factory overhead is to be closed to the cost of goods sold account.
Required: (1) Trial balances of the general ledger and of the factory ledger as of January 1, 19B.
(2) Open general ledger and factory ledger accounts from the January 1 trial balances and record the balances.
(3) Journalize the January transactions.
(4) Post the January transactions to the general ledger, factory ledger, and subsidiary ledgers for materials, work in process, finished goods, and factory overhead incurred.
(5) Trial balances of the general ledger and the factory ledger as of January 31, 19B, reconciling control accounts with subsidiary ledgers.
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(6) A statement of cost of goods sold for January, 19B.