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 $390,000 of manufacturing overhead for an estimated allocation base of 1.000 direct labor-nours. The following transactions took place during the year a. Raw materials purchased on account. $275,000 b. Raw materials used in production (all direct materials). $260,000 c. Utility bills incurred on account. 574.000 (95% related to factory operations, and the remainder related to selling and administrative activities). d. Accrued salary and wage costs: Direct labor (1.100 hours) Indirect labor Selling and adsinistrative salaries 35,000 110,000 $ 185,000 e. Maintenance costs incurred on account in the factory $69.000 Advertising costs incurred on account, $151,000, g. Depreciation was recorded for the year. $87,000 (80% related to factory equipment, and the remainder related to selling and administrative equipment) n Rental cost incurred on account. $112.000 (85% related to factory facilities, and the remainder related to seling and administrative facilities). 1. Manufacturing overhead cost was applied to jobs, $_2 J. Cost of goods manufactured for the year, 5920,000, k. Sales for the year (all on account) totaled $1,950,000. These goods cost $950,000 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 $ 45,00 $ 35,000 $ 75,000 Required: 1. Prepare journal entries to record the preceding transactions 2. Post your entries to T-accounts. (Don't forget to enter the beginning inventory balances above) 3. Prepare a schedule of cost of goods manufactured. 4A. Prepare a journal entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold 4B. Prepare a schedule of cost of goods sold. 5. Prepare an income statement for the year Reg 1 Reg 2 Reg 3 Req 4A Reg 4B Red 5 Prepare journal entries to record the preceding transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Reg 1 Reg 2 Reg 3 Reg 4 Reg 48 Reg 5 Prepare journal entries to record the preceding transactions. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet 1 2 3 4 5 6 7 8 12 > The raw materials used in production (all direct materials), $260,000. Note: Enter debits before credits. Transaction General Journal Debit Credit b Record entry Clear entry View general journal Reg 2 > Reg 1 Reg 2 Req3 Reg 4 Reg 48 Reg 5 Prepare journal entries to record the preceding transactions. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet Reg 1 Reg 2 Reg 3 Reg 4 Reg 43 Reg 5 Prepare journal entries to record the preceding transactions, (If no antry is required for a transaction/event, select "Ne joumal entry required in the first account field.) View transaction list Journal entry worksheet The salary and wage costs accrued were $305.000 (Direct labor), 5105,000 (Indirect labor). $185,000 (Selling and administrative salaries Note: Enter debits before credits General Journal Debit Credit Transaction d. Record entry Clear entry View general journal Reg 2 > Reg 1 Reg 2 Req3 Req 4A Red 48 Reg 5 Prepare journal entries to record the preceding transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 2 3 4 6 7 8 12 RRR The maintenance costs were incurred on account in the factory, $69.000. Note: Enter debits before credits. Debit Credit Transaction General Journal View general journal Clear entry Record entry Reg 2 > Reg 1 Reg 2 Reg 3 Re 4 Reg 40 Reqs Prepare journal entries to record the preceding transactions. If no antry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet 3 4 5 7 8 12 > The advertising costs were incurred on account, 5151.000. Not: Enter debits before credits Debit General Journal Transaction Credit View general journal Clear entry Record entry Reg 2 ) saved Red Req 2 Red 3 ReQ 4A Reg 4B Roas Reg 5 Prepare journal entries to record the preceding transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet The depreciation was recorded for the year, $87,000 (80% related to factory equipment, and the remainder related to selling and administrative equipment). Note: Enter debits before credits Debit General Journal Transaction Credit g View general journal Clear entry Record entry Reg 2 > Reg 1 Reg 2 Reg 3 Reg 4A Reg 4B Reg 5 Prepare journal entries to record the preceding transactions. (if na entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Reg 1 Reg 2 Req3 Reg 4A Reg 40 Reg 5 Prepare journal entries to record the preceding transactions. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet Reg 1 Reg 2 Reg 3 Reg 4 Reg 40 Regs Prepare journal entries to record the preceding transactions. (if no entry is required for a transaction event, le journal entry required in the first account field.) View transaction list Journal entry worksheet 5 6 7 8 9 10 12 A The cost of goods manufactured for the year, 5920,000 Note: Enter debit before credit Transaction General Joumal Debil Credit View all Record entry Certy Reg 2 > Reg 1 Reg 2 Req3 Req 4A Reg 4B Reg 5 Prepare journal entries to record the preceding transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 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 $380,000 of manufacturing overhead for an estimated allocation base of 1,000 direct labor-hours. The following transactions took place during the year a. Raw materials purchased on account. $275,000 b. Raw materials used in production (all direct materials), S260,000 c Utility bills incurred on account, 874,000 (95% related to factory operations, and the remainder related to selling and administrative activities) d. Accrued salary and wage costs: Direct labor (1,100 hours) Indirect labor Selling and administrative salaries 5 305,000 $ 105,000 $ 105,000 e. Maintenance costs incurred on account in the factory $69,000 Advertising costs incurred on account, $151.000. g. Depreciation was recorded for the year, $87.000 (80% related to factory equipment, and the remainder related to selling and n. Rental cost incurred on account, $112.000 (85% related to factory facilities, and the remainder related to selling and administrative facilities) Manufacturing overhead cost was applied to jobs, S2 Cost of goods manufactured for the year, 5920,000, k Sales for the year (all on account totoled $1.950,000. These goods cost $950,000 according to their job cost sheets. The balances in the inventory accounts at the beginning of the year were Raw Materiais work In Process Finished Goods $ 45,000 5 36,000 $ 75,000 Required: 1 Prepare journal entries to record the preceding transactions 2. Post your entries to T accounts (Don't forget to enter the beginning inventory balances above) 3. Prepare a schedule of cost of goods manufactured 4A Prepare a journal entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold. 43. Prepare a schedule of cost of goods sold 5. Prepare an income statement for the year