The law firm of Furlan and Benson accumulates costs associated with individual cases, using a job order cost system. The following transactions occurred during July: July 3. Charged 560 hours of professional (lawyer) time to the Obsidian Co. breech of contract suit to prepare for the trial, at a rate of $240 per hour. 10. Reimbursed travel costs to employees for depositions related to the Obsidian case, $19,800. 14. Charged 190 hours of professional time for the Obsidian trial at a rate of $250 per hour. 18. Received invoice from consultants Wadsley and Harden for $65,900 for expert testimony related to the Obsidian trial. 27. Applied office overhead at a rate of $60 per professional hour charged to the Obsidian case. 31. Paid administrative and support salaries of $32,000 for the month. 31. Used office supplies for the month, $10,800. 31. Paid professional salaries of $184,200 for the month. 31. Billed Obsidian $357,000 for successful defense of the case. a. Provide the journal entries for each of these transactions. If an amount box does not require an entry, leave it blank. July 3 July 10 July 14 July 18 July 27 July 31 Admin. sal. July 31 Supplies July 31 Prof. sal. July 31 Billed July 31 Cost b. How much office overhead is over- or underapplied? Enter your answer as a positive number. c. Determine the gross profit on the Obsidian case, assuming that over- or underapplied office overhead is closed monthly to cost of services.

FINANCIAL ACCOUNTING
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Author:Libby
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Chapter1: Financial Statements And Business Decisions
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### Job Order Cost Accounting for a Service Company

#### Overview
The law firm of Furlan and Benson accumulates costs associated with individual cases, using a job order cost system. Below are the detailed transactions that occurred during July, related to the Obsidian Co. breach of contract suit:

1. **July 3**: 
   - **Charged 560 hours of professional (lawyer) time to the Obsidian Co. breach of contract suit to prepare for the trial**, at a rate of $240 per hour.
2. **July 10**: 
   - **Reimbursed travel costs to employees for depositions related to the Obsidian case**, $19,800.
3. **July 14**: 
   - **Charged 190 hours of professional time for the Obsidian trial** at a rate of $250 per hour.
4. **July 18**: 
   - **Received invoice from consultants Wadsley and Harden for expert testimony related to the Obsidian trial**, $65,900.
5. **July 27**: 
   - **Applied office overhead at a rate of $60 per professional hour charged to the Obsidian case**.
6. **July 31**: 
   - **Paid administrative and support salaries**, $32,000 for the month.
   - **Used office supplies for the month**, $10,800.
   - **Paid professional salaries**, $184,200 for the month.
   - **Billed Obsidian** $357,000 for successful defense of the case.

#### Journal Entries
Provide the Journal entries for each of these transactions. If an amount box does not require an entry, leave it blank.

| Date             | Account Titles and Explanation            | Debit ($) | Credit ($) |
|------------------|-------------------------------------------|-----------|------------|
| **July 3**       | [Account Name]                            | [Amount]  | [Amount]   |
|                  | [Account Name]                            | [Amount]  | [Amount]   |
| **July 10**      | [Account Name]                            | [Amount]  | [Amount]   |
|                  | [Account Name]                            | [Amount]  | [Amount]   |
| **July 14**      | [Account Name]                            | [Amount]  | [Amount]   |
|                  | [Account Name
Transcribed Image Text:### Job Order Cost Accounting for a Service Company #### Overview The law firm of Furlan and Benson accumulates costs associated with individual cases, using a job order cost system. Below are the detailed transactions that occurred during July, related to the Obsidian Co. breach of contract suit: 1. **July 3**: - **Charged 560 hours of professional (lawyer) time to the Obsidian Co. breach of contract suit to prepare for the trial**, at a rate of $240 per hour. 2. **July 10**: - **Reimbursed travel costs to employees for depositions related to the Obsidian case**, $19,800. 3. **July 14**: - **Charged 190 hours of professional time for the Obsidian trial** at a rate of $250 per hour. 4. **July 18**: - **Received invoice from consultants Wadsley and Harden for expert testimony related to the Obsidian trial**, $65,900. 5. **July 27**: - **Applied office overhead at a rate of $60 per professional hour charged to the Obsidian case**. 6. **July 31**: - **Paid administrative and support salaries**, $32,000 for the month. - **Used office supplies for the month**, $10,800. - **Paid professional salaries**, $184,200 for the month. - **Billed Obsidian** $357,000 for successful defense of the case. #### Journal Entries Provide the Journal entries for each of these transactions. If an amount box does not require an entry, leave it blank. | Date | Account Titles and Explanation | Debit ($) | Credit ($) | |------------------|-------------------------------------------|-----------|------------| | **July 3** | [Account Name] | [Amount] | [Amount] | | | [Account Name] | [Amount] | [Amount] | | **July 10** | [Account Name] | [Amount] | [Amount] | | | [Account Name] | [Amount] | [Amount] | | **July 14** | [Account Name] | [Amount] | [Amount] | | | [Account Name
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