Ravsten Company uses a job-order costing system, On January 1, the beginning of the current year, the company's inventory balances were as follows: The company applies overhead cost to jobs on the basis of machine hours. For the current year, the company estimated that it would work 36,000 machine-hours and incur \$155,520 in manufacturing overhead cost. The following transactions were recorded for the year: a. Raw materials were purchased on account $203,500. b. Raw materlals were requisitioned for use in production: $193,500 (80\% direct and 20% indirect). c. The following costs were incurred for employee services. d. Heat, power, and water costs were incuried in the factory. $42.700. e. Prepaid insurance expired duning the year: $10,700(90% relates to factory operations, and 10% relates to seling and administrative actuition) t. Advertising costs were incurted, $50,700. d. Heat, power, and water costs were incurred in the factory: $42,700. e. Prepaid insurance expired during the year $10,700(90% relates to factory operations, and 10% relates to selling and adiministrative activities) 1. Advertising costs were incurred. $50,700. 9. Depreciation was recorded for the year: $60,700 ( 85% relates to factory operations, and 15% relates to selling and administrative. activities) h. Manufacturing overhead cost was applied to production. The company recorded 40,000 machine hours for the year 1. Goods that cost $488,400 to manufacture according to their job cost sheets were transferred to the finished goods warehouse J. Sales for the year totalled $724,500 and were all on account. The total cost to manufacture these goods according to their job cost sheets was $482.000. Required: 1. Prepare joumal entries to record the transactions glven above. (Do not round intermediate calculations. If no entry is required for o transnction/event, select "No journal entry required" in the first occount field.) \begin{tabular}{|c|c|c|c|c|c|} \hline \multicolumn{6}{|c|}{ Manufacturing owenent } \\ \hline & & & Manufacturing overhood & 38,700 & \\ \hline & & & Raw materials & & 193,500 \\ \hline \multirow{7}{*}{1} & & & & & \\ \hline & 3 & c & Work in process & 103,500 & \\ \hline & & & Manutacturing ovirfead & 27,700 & \\ \hline & & & Salos commissions expense & 36,700 & \\ \hline & & & Administrative satahes expense & 81,400 & \\ \hline & & & Salaries and woges payabie & & 300,300 \\ \hline & & & & & \\ \hline & 4 & d & Manufacturing owoibead & 42.700 & \\ \hline & & & Nccounts payable & & 42.700 \\ \hline & & & & & \\ \hline \multirow[t]{4}{*}{1} & 5 & e & Manutacturing owerhead & 9,030 & \\ \hline & & & Insurance expense & 1,070 & \\ \hline & & & Prepaid insurance & & 10,700 \\ \hline & & & & & \\ \hline \multirow[t]{3}{*}{1} & 6 & 1 & Advertising expense & 50,700 & \\ \hline & & & Accounts payabie & & 50,700 \\ \hline & & & & & \\ \hline \multirow[t]{4}{*}{/} & 7 & 9 & Marutacturing overheal & 51,595 & \\ \hline & & & Depreciation expenso & 9,105 & \\ \hline & & & Accumulated depreciation & & 60,700 \\ \hline & = & & & & \\ \hline & - & & & & \\ \hline \end{tabular} Prev 1 ot 2 \begin{tabular}{|c|c|c|c|c|c|c|} \hline \multicolumn{3}{|c|}{ Raw Materials } & \multicolumn{4}{|c|}{ Manufacturing Overtsead } \\ \hline Beg Bal: & 16,700 & & Beg Bal & 0 & & \\ \hline a & 203,500 & 193,5000b & 8. & 42,700 & 172.800 & h \\ \hline End Eal. & 26,700 & & 0 & 9.630 & & \\ \hline & & & 9 & & & \\ \hline & & & c. & 27.7002 & & \\ \hline & & & b & 38,700 & & \\ \hline & & & End Bal & & 2.475 & \\ \hline \multicolumn{3}{|c|}{ Work in Process } & \multicolumn{4}{|c|}{ Cost of Goods Sold } \\ \hline Beg Bal & 10,700 & & Beg. Bal & 07 & & \\ \hlineb & 154,800 & 488.400 & 8 & 482,000 & & \\ \hline E. & 163.5002 & & End Bal & 482,000 & & \\ \hline 6 & 172,800 & & & & & \\ \hline End Bal & 13,400 & & & & & \\ \hline \multicolumn{7}{|c|}{ Finished Goods } \\ \hline Beg. Bal & 31,400 & & & & & \\ \hline t & 488,4007 & 482,000 & & & & \\ \hline End Bal & 37,800 & & & & & \\ \hline \end{tabular} 3-o. Is manufacturing overhead underapplied or overapplied for the year? Underapplied overhead Overapplied overhead 3-b. Prepare a journal entry to properly dispose of any balance in the Manufacturing Overhead account (Round your percentoges and final answers to 2 decimal places. If no entry is required for a tronsaction/event, select "No journal entry required" in the first account field.) 4. Prepare an income statement for the yeat. (Do not round intermediote calculations and round your final answers to nearest whole dollor amount.)
