Problem 3-16 Comprehensive Problem [L03-1, L03-2, LO34) Gold Nest Company of Guandong, China, is a family-owned enterprise that makes birdcages for the South China market. The company sells its birdcages through an extensive network of street vendors who recerve commissions on their sales. The company uses a job-order costing system in which overhead is applied to jobs on the basis of direct labor cost. Its predetermined overhead rate is based on a cost formula that estimated $103,500 of manufacturing overhead for an estimated activity level of $45,000 direct labor dollars. At the beginning of the year, the inventory balances were as follows: Raw materials Work in process Finished goods s 10,200 $ 4,000 $ 8,200 During the year, the following transactions were completed a. Raw materials purchased for cash. S 163.000 Ravw materials used in production 5141,00 imaterials costing $129000 were charged drecthy to jobs, the remaining materialswere indirect) c Cash paid to employees as follows: Oirect labon Indirect labr Sales comn1ssions AdminAstrative salarles $ 168,000 $ 316,300 $ 27,000 5 42,000 d. Cash paid for rent during the year was $18.400 $13.900 of this amount related to factory operations, and the remainder rellat selling and administrative activities) e Cash paid for utility costs in the factory, $14.000 f Cash paid for advertising $15,000