11-17A (Algo) Manufacturing cost flow across three accounting cycles LO 11-1, 11-2, 11-3 The following accounting events affected Rundle Manufacturing Company during its first three years of operation. Assume that all transactions are cash transactions. Transactions for Year 1 Started manufacturing company by issuing common stock for $3,700. Purchased $1,290 of direct raw materials. Used $770 of direct raw materials to produce inventory. Paid $330 of direct labor wages to employees to make inventory. Applied $320 of manufacturing overhead cost to Work in Process Inventory. Finished work on inventory that cost $930. Sold goods that cost $650 for $1,140. Paid $370 for selling and administrative expenses. Actual manufacturing overhead cost amounted to $222 for the year. Transactions for Year 2 Acquired additional $800 of cash from common stock. Purchased $1,220 of direct raw materials. Used $1,230 of direct raw materials to produce inventory. Paid $550 of direct labor wages to employees to make inventory. Applied $310 of manufacturing overhead cost to Work in Process Inventory. Finished work on inventory that cost $1,840. Sold goods that cost $1,590 for $2,880. Paid $500 for selling and administrative expenses. Actual manufacturing overhead cost amounted to $370 for the year. Transactions for Year 3 Paid a cash dividend of $700. Purchased $1,400 of direct raw materials. Used $1,130 of direct raw materials to produce inventory. Paid $350 of direct labor wages to employees to make inventory. Applied $310 of manufacturing overhead cost to work in process. Finished work on inventory that cost $2,010. Sold goods that cost $2,210 for $3,560. Paid $690 for selling and administrative expenses. Annual manufacturing overhead costs were $260 for the year. Required a.c.&d. Record the preceding events in horizontal statements models for each of the three years. Close overapplied or underapplied overhead to Cost of Goods Sold. In Year 1, the first event is shown as an example. b.&d. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet as of the close of business on December 31, Year 1, Year 2 and Year 3