Hobbit Company is a manufacturing firm that uses job-order costing. The company's inventory balances were as follows at the beginning and end of the year:

Beginning Ending Balance

Raw materials $14,000 $22,000

Working in process $27,000 $9,000

Finished goods $62,000 $77,000

The company applies overhead to jobs using a predetermined overhead rate based on machine- hours. At the beginning of the year, the company estimated that it would work 33,000 machine- hours and incur $231,000 in manufacturing overhead cost. The following transactions were recorded for the year:

Raw materials were purchased, $315,000. Raw materials were requisitioned for use in production, $307,000 ($281,000 direct and $26,000

indirect). The following employee costs were incurred: direct labor, $377,000; indirect labor, $96,000;

and administrative salaries, $172,000. Selling costs, $147,000. Factory utility costs, $10,000. Depreciation for the year was $127,000 of which $120,000 is related to factory operations and

$7,000 is related to selling, general, and administrative activities. Manufacturing overhead was applied to jobs. The actual level of activity for the year was

34,000 machine-hours. Sales for the year totaled $1,253,000.

Required: Please complete the following in good form. USE AS MANY FORMULAS IN EXCEL AS POSSIBLE

a. Prepare a Schedule of Cost of Goods Manufactured. b. Was the overhead underapplied or overapplied? By how much? c. Prepare a Schedule of Cost of Goods Sold. The company closes any underapplied or

overapplied overhead to Cost of Goods Sold. d. Prepare an income statement for the year.