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 that 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 $373,700 of manufacturing overhead for an estimated allocation base of 1,010 direct labor-hours. The following transactions took place during the year: a. Raw materials purchased on account, $255,000. b. Raw materials used in production (all direct materials), $240,000. c. Utility bills incurred on account, $70,000 (95% related to factory operations, and the remainder related to selling and administrative activities). d. Accrued salary and wage costs: Direct labor (1,085 hours) Indirect labor Selling and administrative salaries $ 285,000 $ 101,000 $ 165,000 e. Maintenance costs incurred on account in the factory, $65,000 f. Advertising costs incurred on account, $147,000. g. Depreciation was recorded for the year, $83,000 (80% related to factory equipment, and the remainder related to selling and administrative equipment).