Bergo Bay's accounting system generated the following account balances on December 31. The company's manager knows something is wrong with this list of balances because it does not show any balance for Work in Process Inventory, and the accrued factory payroll (Factory Wages Payable) has not been recorded. Debit Credit Cash $ 71,000 Accounts receivable Raw materials inventory Work in process inventory Finished goods inventory Prepaid rent Accounts payable 40,000 25,000 12,000 4,000 $ 11,100 Notes payable 14,100 Common stock Retained earnings (prior year) Sales Cost of goods sold 40,000 88,000 181,800 Factory overhead General and administrative expenses Totals 112,000 26,000 45,000 $ 335,000 $ 335,000 These six documents must be processed to bring the accounting records up to date. Materials requisition 10: Materials requisition 11: Materials requisition 12: Labor time ticket 52: Labor time ticket 53: Labor time ticket 54: $ 4,500 direct materials to Job 402 $ 7,800 direct materials to Job 404 $ 1,700 indirect materials $ 5,000 direct labor to Job 402 $ 15,000 direct labor to Job 404 $ 5,000 indirect labor Jobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 100% of direct labor cost. a. Direct materials. b. Direct labor. c. Overhead applied. d. Indirect materials. e. Indirect labor. Required: 1. Use the document information above to prepare journal entries for the above costs. View transaction list Journal entry worksheet 1 2 3 4 5 Record direct materials used for Jobs 402 and 404. Note: Enter debits before credits. Transaction a. General Journal Debit Credit > 2-a. In Factory Overhead T-account, enter amounts from part 1 related to factory overhead. Determine the amount of over- or underapplied overhead. 2-b. Prepare the entry to close any over- or underapplied overhead to Cost of Goods Sold. Complete this question by entering your answers in the tabs below. Req 2A Req 2B In Factory Overhead T-account, enter amounts from part 1 related to factory overhead. Determine the amount of over- or underapplied overhead. Factory Overhead Actual overhead (given) < Req 2A Req 2B > 3. Prepare a revised list of account balances as of December 31. Hint: Use the prior year's Retained Earnings balance of $88,000 in this list. BERGO BAY COMPANY List of Account Balances December 31 Debit Credit Cash Accounts receivable Raw materials inventory Work in process inventory Finished goods inventory Prepaid rent Accounts payable Factory wages payable Notes payable Common stock Retained earnings (prior year) Sales Cost of goods sold Factory overhead General and administrative expenses Totals 4. Prepare an income statement for the year and a balance sheet as of December 31. Hint: Retained earnings is $100,100 at the end of the current year. 5. Assume that the $1,700 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result in overstatement or understatement of total assets? Complete this question by entering your answers in the tabs below. Req 4 Income Req 4 Balance Statement Sheet Prepare an income statement. Req 5 BERGO BAY COMPANY Income Statement For Year Ended December 31 < Req 4 Income Statement Req 4 Balance Sheet >