Baab Corporation is a manufacturing firm that uses job$-$order costing. The company's inventory balances were as follows at the

beginning and end of the year:

The company applies overhead to jobs using a predetermined overhead rate based on machine$-$hours. At the beginning of the

year, the company estimated that it would work $33,350$ machine$-$hours and incur $$256,795$ in manufacturing overhead cost. The

following transactions were recorded for the year.

Raw materlals were purchased, $$315,350.$

Raw materlals were requisitioned for use in production, $$307,350($ $$280,650$ direct and $$26,700$ indirect$).$

The following employee costs were incurred: direct labor, $$377,350$; Indirect labor, $$96,350$; and administrative salaries.

$$172,350.$

Selling costs, $$147,350.$

Factory utlility costs, $$10,350.$

Depreclation for the year was $$148,000$ of which $$131,000$ is related to factory operations and $$17,000$ is related to selling.

general, and administrative activities.

Manufacturing overhead was applied to jobs. The actual level of activity for the year was $34,070$ machine$-$hours.

Sales for the year totaled $$1,267,000.$

Required:

a$.$ Prepare a schedule of cost of goods manufactured.

b$.$ Was the overhead underapplied or overapplied? By how much?

c$.$ Prepare an Income statement for the year. The company closes any underapplied or overapplied overhead to Cost of Goods Sold.

Complete this question by entering your answers in the table below.

Prepare a schedule of cost of goods manufactured. Baab Corporation is a manufacturing firm that uses job$-$order costing. The company's inventory balances were as follows at the

beginning and end of the year:

The company applies overhead to jobs using a predetermined overhead rate based on machine$-$hours. At the beginning of the

year, the company estimated that it would work $33,350$ machine$-$hours and incur $$256,795$ in manufacturing overhead cost. The

following transactions were recorded for the year:

Raw materials were purchased, $$315,350.$

Raw materials were requisitioned for use in production, $$307,350($ $$280,650$ direct and $$26,700$ indirect$).$

The following employee costs were incurred: direct labor, $$377,350$; indirect labor, $$96,350$; and administrative salaries,

$$172,350.$

Selling costs, $$147,350.$

Factory utility costs, $$10,350.$

Depreciation for the year was $$148,000$ of which $$131,000$ is related to factory operations and $$17,000$ is related to selling,

general, and administrative activities.

Manufacturing overhead was applied to jobs. The actual level of activity for the year was $34,070$ machine$-$hours.

Sales for the year totaled $$1,267,000.$

Required:

a$.$ Prepare a schedule of cost of goods manufactured.

b$.$ Was the overhead underapplied or overapplied? By how much?

c$.$ Prepare an income statement for the year. The company closes any underapplied or overapplied overhead to Cost of Goods Sold.

Complete this question by entering your answers in the table below.

Was the overhead underapplied or overapplied? By how much?