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. 4. an income statement for the year and a balance sheet as of December 31. Hint: Retained earnings is $106,100 at the end of the current year.5. Assume that the $2,100 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result in overstatement or understatement of total assets?

Debit Credit Cash $ 71, 000 Accounts receivable 40, 000 Raw materials inventory 25, 000 Work in process inventory Finished goods inventory 15, 000 Prepaid rent 5, 000 Accounts payable $ 9, 900 Notes payable 12, 900 Common stock 50, 000 Retained earnings (prior year) 92, 000 Sales 171, 200 Cost of goods sold 116, 000 Factory overhead 27, 000 General and administrative expenses 37, 000 Totals $ 336, 000 $ 336, 000 These six documents must be processed to bring the accounting records up to date. Materials requisition 10: $ 4, 700 direct materials to Job 402 Materials requisition 11: $ 7,300 direct materials to Job 404 Materials requisition 12: 2, 100 indirect materials Labor time ticket 52: $ 8, 000 direct labor to Job 402 Labor time ticket 53: $ 12, 000 direct labor to Job 404 Labor time ticket 54: $ 5, 000 indirect labor Jobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 150% of direct labor cost. 4. Prepare an income statement for the year and a balance sheet as of December 31. Hint: Retained earnings is $106,100 at the end of the current year. 5. Assume that the $2,100 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 Sheet Req 5 Statement