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CoursHeroTranscribedText: Kim's Asphalt does driveway and parking lot resurfacing work for large commercial clients as well as small residential clients. An inventory of materials and equipment is on hand at all times so that work can start as quickly as possible. Special equipment is ordered as required. On May 1, the Materials and Equipment Inventory account had a balance of $40,000. The Work-in-Process Inventory account is maintained to record costs of work not yet complete. There were two such jobs on May 1 with the following costs. Job 27 Job 33 Highlands Mall Pine Ridge Estates Materials and equipment $15,975 $52,900 Direct labor 13,900 26,450 Overhead (applied) 4,170 7,935 Overhead has been applied at 30 percent of the costs ofdirect labor. During May, Kim's Asphalt started two newjobs. Additional work was carried out on Jobs 27 and 33, with the latter completed and billed to Pine Ridge Estates. Details on the costs incurred on jobs during May follow. Job 27 33 34 35 Materials and equipment $3,400 $5,200 $5,000 $3,300 Direct labor (wages payable) 4,900 7,150 6,300 2,000 Other May Events Received $12,900 payment on Job 24 delivered to customer in April. Purchased materials and equipment for $9,800 on account. Billed Pine Ridge Estates $134,000 and received payment for $95,000 of that amount. Determined that payroll for indirect labor personnel totaled $690. Issued supplies and incidental materials for current jobs costing $195. Recorded overhead and advertising costs for the operation as follows (all cash except equipment depreciation). P'MPP'NH Property taxes $590 Storage area rental 715 Truck and delivery cost 360 Advertising and promotion campaign 640 Inspections 240 Telephone and other miscellaneous 365 Equipment depreciation 490 Record purchase of materials and equipment of $9,800 on account. Note: Enter debits before credits. Record receipt of $95,000 towards the billings. Note: Enter debits before credits. Record issue of supplies and incidental materials for current jobs costing $195. Note: Enter debits before credits. Record overhead, advertising and depreciation cost as per the table given above. Note: Enter debits before credits. Record charges to work in process. Note: Enter debits before credits. 0 a] Calculate the amount of over or underapplied overhead for the month. Determine inventory balances for Materials and Equipment Inventory and Work-in-process inventory. Materials and equipment inventory Work-in-process inventory

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