Froya Fabrikker A/S of Bergen, Norway, is a small company that manufactures specialty heavy equipment for use in North Sea oil fields. The company uses a job-order costing system and applies manufacturing overhead cost to jobs on the basis of direct labor- hours. Its predetermined overhead rate was based on a cost formula that estimated $395,600 of manufacturing overhead for an estimated allocation base of 920 direct labor-hours. The following transactions took place during the year (all purchases and services were acquired on account): a. Raw materials purchased for use in production, $290,000 b. Raw materials requisitioned for use in production (all direct materials), $275,000. c. Utility bills were incurred, $77,000 (90% related to factory operations, and the remainder related to selling and administrative activities). d. Salary and wage costs were incurred: Direct labor (970 hours) Indirect labor Selling and administrative salaries 320,000 108,000 $200,000 e. Maintenance costs were incurred in the factory, $72,000. f. Advertising costs were incurred, $154,000. g. Depreciation was recorded for the year. $90,000 (75% related to factory equipment, and the remainder related to selling and administrative equipment). h. Rental cost incurred on buildings, $115,000 (80% related to factory operations, and the remainder related to selling and administrative facilities). I. Manufacturing overhead cost was applied to jobs, $ ?. 1. Cost of goods manufactured for the year, $950,000. k. Sales for the year (all on account) totaled $2,100,000. These goods cost $980,000 according to their job cost sheets. The balances in the inventory accounts at the beginning of the year were: Raw materials Work in process Finished Goods $ 48,000 $39,000 78,000 $ View transaction list X 1 Raw materials were purchased for use in production, $290,000 on account. 12 ccount. 2 Raw materials were requisitioned for use in production (all direct materials), $275,000. 3 Utility bills were incurred, $77,000 (90% related to factory operations, and the remainder related to selling and administrative activities). Credit 4 Salary and wage costs incurred were $320,000 (Direct labor), $108,000 (Indirect labor), $200,000 (Selling and administrative salaries). 5 Maintenance costs were incurred in the factory, $72,000. Note : = journal entry has been entered Record entry Clear entry View general journal View transaction list X 12 6 Advertising costs were incurred, $154,000. 7 Depreciation was recorded for the year, $90,000 (75% related to factory equipment, and the remainder related to selling and administrative equipment). 8 Rental cost incurred on buildings, $115,000 (80% related to factory operations, and the remainder related to selling and administrative facilities). ccount. Credit 9 Record the entry for manufacturing overhead cost applied to jobs. 10 Cost of goods manufactured for the year, $950,000. 11 Sales for the year (all on account) totaled $2,100,000. Note : = journal entry has been entered Record entry Clear entry View general journal