Gold Nest Company af Cuandong, China, is a family onned enterpnse that makes bird:ages for the South Chinamarkct The company scils its birdcages through an cxtensvc network of strect vendors who reccive commissions on their sales. All of the company's transactions with customers, employccs, and supplicrs are conducted in cash, there s no credt. The company uscs a job-order costing sysicm in which overhcad is applied to jobs on thc basis of direct labor cost Its predetemned cverhead rate is based on a cost fomula that estimated $330,003 ct manufacturing overhead for an estimated activity level of $200,000 direct labor dolars Athe begming of the year, the inventory balances were as follows: rstaccourt ield Roun your irternedi za calalstoes to 2 deoir psc Raw matorials Work in process Finished goods S $ 25,000 10,000 S4000D Journal entry worksheet 4 Prepare an income statement for the year (Round your intermediate calculations to 2 decima places.) During the year, the tollowing transactions were completed a Raw materials purchased for cash, $275,000 b.Raw materials requisitioned for use in production, $280,000 (materials costing $220,000 were charged Nest Company Income Statement For the Yoar Ended drectly to jcbs; the remaning matenals were indrect. Costs for employce scrvices were incurred as frllows to Cast o Goods Sold. t. Drect labar Indrect kbo Sales commissions Administraive salaries 130,000 5 72000 S 63,000 90,000 D Cred Scing and administrative xenses d Rent for thc year was $18,000 $13,000 of this amount relatod to factory operations, and the remainder relaned to scling and administrative activites). e Udliy costs incurred in the factory, $57,000 f. Adverising costs incurred, $140,000 g Depreciation recorded an equipment $103,000 (380,0CO of this amount was on ecuipment used in factory opcrations,; the romaining $12,000 was on cquipment used in sclling and administrative activitics) h.Manufacturing overhead cost was applied to jobs, S2 i. Goods that had cost $875,000 to manufacture accordng to their jeb cost sheets were completed j Sales for the year totaled $1,250,000. The total cost to manufacture these goods according to their job Clear enty cost sheets was $700 000