3. (10 points) Job-order Costing Gold Nest Company of Gundong, China, is a family-owned enterprise that makes birdcages for the South China market. A popular pastime among older Chinese men is to take their pet banda e daily excursions to teahouses and public parts where they meet with other bird owners to talk and play mahjong. A great deal of attention is lavished on these birds, and the birdcapes are often laborately constructed from exotic woods and contain porcelain feeding bowls and silver roost. Gold Next Company makes a broad range of birdcages that it sells through an extensive network of street vendor who receive commissions on their sales. The Chinese Currency is the termini, which is dood by Rmb. All of the company's transactions with customers, employees and supplies are conducted in cash, there is no credit. The company uses a job order costing system in which overhead is applied to jobs on the basis of direct labor cost. At the beginning of the year, it was estimated that the total direct labor con for the your would be mb110,000 and the total manufacturing overhead cost would be R275.000. At the beginning of the year, the inventory balances were as follows: Raw materials Rmb13,000 Work in process ---....mb30,000 Finished goods Rm65.000 During the year, the following transactions were completed: a. Raw materials purchased for cash, Rm150,000 b. Raw materials requisitioned for use in production, Rm158,000. (Materials costing Rmb35,000 were charged directly to jobs, the remaining materials were indirect c. Costs for employee services were incurred as follows: Direct labor Rm100,000 Indirect labor. Rm10,000 Sales commissions Rmb22,000 Administrative salaries.... Rm35.000 d. Rent for the year was Rmb36,000. (Rmb30,000 of this amount related to factory operations, and the remainder related to selling and administrative activities.) c. Utility costs incurred in the factory, Rm90.000. 1. Advertising costs incurred, Rmb88.000. g. Depreciation recorded on equipment, Rm80.000. (Rm66,000 of this amount was on equipment used in factory operations, the remaining Rm14,000 was on equipment used in selling and administrative activities.) h. Manufacturing overhead cost was applied to jobs, Rmb i. Goods that cost Rmb490,000 to manufacture according to their job cost sheets were completed during the year ). Sales for the year totaled Rmb995,000. The total cost to manufacture these goods according to their job cost sheets was Rm 550,000 Required: (1). Prepare journal entries to record the transactions for the year. (2). Prepare T-accounts for inventories, Manufacturing Overhead, and Cost of Goods Sold. Post relevant data from your journal entries to these T-accounts. (Don't forget to enter the beginning balances in your inventory accounts.) Compute an ending balance in each account. (3). Is Manufacturing Overhead underapplied or overapplied for the year? Prepare a journal entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold. (4). Prepare an income statement for the year. (Do not prepare a schedule of cost of goods manufactured; all of the information needed for the income statement is available in the journal entries and T-accounts you have prepared.)