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. Cash Debit Credit $170,000 Accounts receivable Raw materials inventory. Work in process inventory 75,000 80,000 0 Finished goods inventory 15,000 Prepaid rent.. 3,000 Accounts payable $ 17,000 Notes payable... 25,000 Common stock 50,000 Retained earnings (prior year) 271,000 Sales 373,000 Cost of goods sold 218,000 Factory overhead 115,000 General and administrative expenses 60,000 Totals $736,000 $736,000 These six documents must be processed to bring the accounting records up to date. Materials requisition 10: $10,200 direct materials to Job 402 Materials requisition 11: $18,600 direct materials to Job 404 Materials requisition 12: $5,600 indirect materials Labor time ticket 52: $36,000 direct labor to Job 402 Labor time ticket 53: $23,800 direct labor to Job 404 Labor time ticket 54: $8,200 indirect labor Jobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 200% of direct labor cost. Required 1. Use the document information above to prepare journal entries for the following costs. a. Direct materials. b. Direct labor. c. Overhead applied. d. Indirect materials. e. Indirect labor. 2. Set up a Factory Overhead T-account and enter amounts from part 1 related to factory overhead. Determine the amount of over- or underapplied overhead. Prepare the entry to close any over- or underapplied overhead to Cost of Goods Sold. 3. Prepare a revised list of account balances as of December 31. Hint: Use the prior year's Retained Earnings balance of $271,000 in this list. 4. Prepare an income statement for the year and a balance sheet as of December 31. Hint: Retained earn- ings is $356,800 at the end of the current year. 5. Assume that the $5,600 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result in overstatement or understatement of total assets on the balance sheet at December 312