Problem 2-26A Journal Entries; T-Accounts; Financial Statements [LO2-1, LO2-2, LO2-3, LO2-4, LO2-5, LO2-6, LO2-7] 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 $374,000 of manufacturing overhead for an estimated allocation base of 1,100 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, S235,000. b. Raw materials requisitioned for use in production (all direct materials), 5220,000. c. Utility bills were incurred, 566,000 (90% related to factory operations, and the remainder related to selling and administrative activities). d. Salary and wage costs were incurred: Direct labor (1,175 hours) Indirect labor Selling and administrative salaries $ 265,000 $ 97,000 $ 145,000 e. Maintenance costs were incurred in the factory, $61,000. f. Advertising costs were incurred, $143,000. g. Depreciation was recorded for the year, $91,000 (80% related to factory equipment, and the remainder related to selling and administrative equipment). h. Rental cost incurred on buildings, $116,000 (85% related to factory operations, and the remainder related to selling and administrative facilities). I Manufacturing overhead cost was applied to jobs, $ ?. Cost of goods manufactured for the year, S840,000. k. Sales for the year (all on account) totaled $1,550,000. These goods cost $870,000 according to their job cost sheets. The balances in the inventory accounts at the beginning of the year were: The balances in the inventory accounts at the beginning of the year were: Raw materials Work in process Finished Goods $ 37,000 $ 28,000 $ 67,000 Required: 1.Prepare journal entries to record the above data. (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 Raw materials were purchased for use in production, $235,000 on account. Note: Enter debits before credits. Transaction General Journal Debit Credit a Journal entry worksheet 1 2. 3 4 5 6 7 8 .... 12 Raw materials were requisitioned for use in production (all direct materials), $220,000. Note: Enter debits before credits. General Journal Debit Credit Transaction b. Record entry Clear entry View general journal Journal entry worksheet 1 2 2 3 4 5 6 7 8 12 Utility bills were incurred, $66,000 (90% related to factory operations, and the remainder related to selling and administrative activities). Note: Enter debits before credits. Transaction General urnal Debit Credit C. Record entry Clear entry View general journal Journal entry worksheet Salary and wage costs incurred were $265,000 (Direct labor), $97,000 (Indirect labor), $145,000 (Selling and administrative salaries). Note: Enter debits before credits. General Journal Debit Credit Transaction d. Record entry Clear entry View general journal Journal entry worksheet 1 2 3 4 5 6 7 8 .... 12 Maintenance costs were incurred in the factory, $61,000. Note: Enter debits before credits. Transaction General Journal Debit Credit e. Record entry Clear entry View general journal View transaction list Journal entry worksheet Advertising costs were incurred, $143,000. Note: Enter debits before credits. General Journal Debit Credit Transaction f. Record entry Clear entry View general journal Journal entry worksheet Depreciation was recorded for the year, $91,000 (80% related to factory equipment, and the remainder related to selling and administrative equipment). Note: Enter debits before credits. General Journal Debit Credit Transaction g. Record entry Clear entry View general journal Journal entry worksheet 1 2 3 4 5 6 7 8 8 12 > : Rental cost incurred on buildings, $116,000 (85% related to factory operations, and the remainder related to selling and administrative facilities). Note: Enter debits before credits. General Journal Debit Credit Transaction h. Record entry Clear entry View general journal Journal entry worksheet 1 2 3 4 5 6 7 8 8 12 > : Rental cost incurred on buildings, $116,000 (85% related to factory operations, and the remainder related to selling and administrative facilities). Note: Enter debits before credits. General Journal Debit Credit Transaction h. Record entry Clear entry View general journal Journal entry worksheet Record the entry for manufacturing overhead cost applied to jobs. Note: Enter debits before credits. General Journal Debit Credit Transaction i. Record entry Clear entry View general journal Journal entry worksheet Cost of goods manufactured for the year, $840,000. Note: Enter debits before credits. General Journal Debit Credit Transaction j Record entry Clear entry View general journal Journal entry worksheet Sales for the year (all on account) totaled $1,550,000. Note: Enter debits before credits. General Journal Debit Credit Transaction k(1). Record entry Clear entry View general journal Journal entry worksheet Record the entry to close any balance in the manufacturing overhead account to cost of goods sold. Note: Enter debits before credits. General Journal Debit Credit Event 1 Record entry Clear entry View general journal Schedule of Cost of Goods Sold Goods available for sale Unadjusted cost of goods sold Adjusted cost of goods sold 5. Prepare an income statement for the year. Froya Fabrikker A/S Income Statement For the Year Ended Selling and administrative expenses: 6.Job 412 was one of the many jobs started and completed during the year. The job required $8,700 in direct materials and 35 hours of direct labor time at a total direct labor cost of $9,600. If the job contained four units and the company billed at 70% above the unit product cost on the job cost sheet, what price per unit would have been charged to the customer? Price charged for Job 412 per unit