Forest Components makes aircraft parts. The following transactions occurred in July.

1. Purchased $16,870 of materials on account.

2. Issued $16,890 in direct materials to the production department.

3. Issued $1,260 of supplies from the materials inventory.

4. Paid for the materials purchased in transaction (1) using cash.

5. Returned $2,070 of the materials issued to production in (2) to the materials inventory.

6. Direct labor employees earned $31,700, which was paid in cash.

7. Purchased miscellaneous items for the manufacturing plant for $17,360 on account.

8. Recognized depreciation on manufacturing plant of $36,500.

9. Applied manufacturing overhead for the month.

Forest uses normal costing. It applies overhead on the basis of direct labor costs using an annual, predetermined rate. At the beginning of the year, management estimated that direct labor costs for the year would be $435,200. Estimated overhead for the year was $413,440.

The following balances appeared in the inventory accounts of Forest Components for July.

	Beginning			Ending
Materials Inventory		?		$	12,570
Work-in-Process Inventory		?			10,580
Finished Goods Inventory	$	2,620			7,020
Cost of Goods Sold		?			75,300

Required:

a. Prepare journal entries to record these transactions.

b. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold.

Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold.

Materials Inventory Work-In-Process Inventory Beg. bal. 11,780 Beg. bal. 1. 16,870 16,890 2. 2. 16,890 2,070 5. 5. 2,070 1,260 3. 6. 31,700 Transferred to Finished Goods 9. 30,120 End. bal. 12,570 End. bal. 76,640 Manufacturing Overhead Control Applied Manufacturing Overhead Beg. bal. Beg. bal. End. bal. 0 End. bal. 0 Accounts Payable Cash Beg. bal. Beg. bal. End. bal. 0 End. bal. 0 Accumulated DepreciationProperty, Plant, and Equipment Finished Goods Inventory Beg. bal. Beg. bal. Goods completed Transfer to Cost of Goods Sold End. bal. 0 End. bal. 0 Cost of Goods Sold Beg. bal. Goods completed End. bal. 0