Shown below are the job cost related accounts for the law firm of Jack, Bob, and Will and their manufacturing equivalents:

Law Finn Accounts

Manufacturing Finn Accounts


Raw Materials

Salaries and Wages Payable

Factory Wages Payable

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 $1,500.
  2. Issued supplies $1,200 (60% direct and 40% indirect).
  3. Assigned labor costs based on time cards for the month which indicated labor costs of $60,000 (80% direct and 20% indirect).
  4. Operating overhead costs incurred for cash totaled $40,000.
  5. Operating overhead is applied at a rate of 90% of direct attorney cost.
  6. Work completed totaled $75,000.


(a)Journalize the transactions for March. (Omit explanations.)

(b)Determine the balance of the Service Contracts in Process account. (Use a T-account.)