Problem $2-26$A Journal Entries; T$-$Accounts; Financial Statements $[$LO$2-1,$ LO$2-2,$ LO$2-3,$ LO$2-4,$ LO$2-5,$ LO$2-6,$ LO$2-7]$

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 and 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 $$351,500$ of manufacturing overhead for an estimated allocation base of $950$ direct labor$-$hours. The following transactions took place during the year $($all purchases and services were acquired on account$)$:

a$.$ Raw materials purchased for use in production, $$215,000.$

b$.$ Raw materials requisitioned for use in production $($all direct materials$),$ $$200,000.$

c$.$ Utility bills were incurred, $$62,000(85\%$ related to factory operations, and the remainder related to selling and administrative activities$).$

d$.$ Salary and wage costs were incurred:

Direct labor $(1,025$ hours$)$ $ $245,000$

Indirect labor $ $93,000$

Selling and administrative salaries $ $125,000$

e$.$ Maintenance costs were incurred in the factory, $$57,000.$

f$.$ Advertising costs were incurred, $$139,000.$

g$.$

Depreciation was recorded for the year, $$87,000(80\%$ related to factory equipment, and the remainder related to selling and administrative equipment$).$

h$.$

Rental cost incurred on buildings, $$112,000(85\%$ related to factory operations, and the remainder related to selling and administrative facilities$).$

i$.$ Manufacturing overhead cost was applied to jobs, $ $?.$

j$.$

Cost of goods manufactured for the year, $$800,000.$

k$.$

Sales for the year $($all on account$)$ totaled $$1,350,000.$ These goods cost $$830,000$ according to their job cost sheets.

The balances in the inventory accounts at the beginning of the year were:

Raw materials $ $33,000$

Work in process $ $24,000$

Finished Goods $ $63,000$

Required:

$1.$

Prepare journal entries to record the above data. $3.$ Prepare a schedule of cost of goods manufactured. $4.$

Prepare a journal entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold. Prepare a schedule of cost of goods sold. $5..$

Job $412$ was one of the many jobs started and completed during the year. The job required $$8,300$ in direct materials and $40$ hours of direct labor time at a total direct labor cost of $$9,200.$ If the job contained five units and the company billed at $60\%$ above the unit product cost on the job cost sheet, what price per unit would have been charged to the customer?

Prepare an income statement for the year.