5 The following Balance Sheet was taken from the records of Fairport Manufacturing Company at the beginning of Year 3. Balance Sheet as of January 1, Year 2 10 points Assets Cash $ 20,000 eBook Raw materials inventory Work in process inventory Finished goods inventory Property, plant, and equipment (net) 1,800 2,400 4,200 9,000 Total Assets $ 37,400 Stockholders' Equity Common stock Retained earnings 16,800 20,600 Print Total Stockholders' Equity $ 37,400 References Transactions for the Accounting Period 1. Fairport purchased $11,400 of direct raw materials and $600 of indirect raw materials on account. The indirect materials are capitalized in the Production Supplies account. Materials requisitions showed that $10,800 of direct raw materials had been used for production during the period. The use of indirect materials is determined at the end of the year by physically counting the supplies on hand. 2. By the end of the year, $10,500 of the accounts payable had been paid in cash. 3. During the year, direct labor amounted to 950 hours recorded in the Wages Payable account at $21 per hour. 4. By the end of the year, $18,000 of wages payable had been paid in cash. 5. At the beginning of the year, the company expected overhead cost for the period to be $12,600 and 1,000 direct labor hours to be worked. Overhead is allocated based on direct labor hours, which, as indicated in Event 3, amounted to 950 for the year. 6. Selling and administrative expenses for the year amounted to $1,800 paid in cash. 7. Utilities and rent for production facilities amounted to $9,300 paid in cash. 8. Depreciation on the plant and equipment used in production amounted to $3,000. 9. There was $24,000 of goods completed during the year. 10. There was $25,500 of finished goods inventory sold for $36,000 cash. 11. A count of the production supplies revealed a balance of $178 on hand at the end of the year. 12. Any over- or underapplied overhead is considered to be insignificant. Required a. Prepare T-accounts with the beginning balances shown in the preceding list and record all transactions for the year including closing entries in the T-accounts. b-1. Prepare a schedule of cost of goods manufactured and sold. b-2. Prepare an income statement. b-3. Prepare a balance sheet. Req A Req B1 Req B2 Req B3 Prepare T-accounts with the beginning balances shown in the preceding list and record all transactions for the year including closing entries (using one entry) in the T-accounts. Cash Accounts Payable Debit Credit Debit Credit Beginning Balance Beginning Balance Ending Balance Ending Balance Raw Materials Wages Payable Debit Credit Debit Credit Beginning Balance Beginning Balance Ending Balance Ending Balance Debit Manufacturing Overhead Beginning Balance Ending Balance Ending Balance Common Stock Credit Debit Credit Beginning Balance Ending Balance Work in Process Retained Earnings Debit Credit Debit Credit Beginning Balance Ending Balance Finished Goods Debit Credit Beginning Balance Ending Balance Ending Balance Production Supplies Debit Credit Property, Plant, and Equipment Debit Credit Beginning Balance Ending Balance Accumulated Depreciation Debit Credit Beginning Balance Ending Balance Ending Balance Ending Balance Ending Balance Sales Revenue Debit Credit 0 0 Cost of Goods Sold Debit Credit Selling and Administrative Expenses Debit Credit Req A Req B1 Req B2 Req B3 Prepare a schedule of cost of goods manufactured and sol FAIRPORT MANUFACTURING COMPANY Cost of Goods Manfactured and Sold For the Year Ended December, Year 3 Raw materials available Raw materials used Total manufacturing costs Total work in process inventory Cost of goods manufactured Goods available Cost of goods sold Req A Req B1 Req B2 Req B3 Prepare an income statement. FAIRPORT MANUFACTURING COMPANY Income Statement For the Year Ended December, Year 3 Req A Req B1 Req B2 Req B3 Prepare a balance sheet. Note: Amounts to be deducted should be indicated by a minus sign. FAIRPORT MANUFACTURING COMPANY Balance Sheet for Year 3 At December, Year 3 Assets Total assets Liabilities Stockholders' equity Total stockholders' equity