Fanning Construction Company began operations on January $1,$ Year $1,$ when it acquired $$20,000$ cash from the issuance of common stock. During the year, Fanning purchased $$2,900$ of direct raw materials and used $$2,700$ of the direct materials. There were $104$ hours of direct labor worked at an average rate of $$8$ per hour paid in cash. The predetermined overhead rate was $$4\mathrm{.}00$ per direct labor hour. The company started construction on three prefabricated buildings. The job cost sheets reflected the following allocations of costs to each building.

$\backslash$table$[[,$Direct Materials,$\backslash$table$[[$Direct Labor$],[$Hours$]]],[$Job $1,$$$600,32],[$Job $2,1,200,46],[$Job $3,900,26]]$

The company paid $$63$ cash for indirect labor costs. Actual overhead cost paid in cash other than indirect labor was $$345.$ Fanning completed Jobs $1$ and $2$ and sold Job $1$ for $$1,614$ cash. The company incurred $$150$ of selling and administrative expenses that were paid in cash. Over$-$ or underrapplied overhead is closed to Cost of Goods Sold.

Required

a$.$ Record the preceding events in a horizontal statements model. The first event for Year $1$ has been recorded as an example.

c$.$ Record the closing entry for over$-$ or underapplied manufacturing overhead in the horizontal statements model, assuming that the amount is insignificant.

d$-1.$ Prepare a schedule of cost of goods manufactured and sold for Year $1.$

d$-2.$ Prepare an income statement for Year $1.$

d$-3.$ Prepare a balance sheet for Year $1.$

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

Req A and C Req D$1$

a$.$ Record the preceding events in a horizontal statements model. The first event for Year $1$ has been recorded as an example.

c$.$ Record the closing entry for over$-$ or underapplied manufacturing overhead in the horizontal statements model, assuming that the amount is insignificant.

Note: Record each cost category for the jobs in total. When entering cost data, please combine all job costs of direct raw materials, direct labor, and manufact decreases to account balances with a minus sign.