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: Raw materials work in process Finished goods $24,500 $13,400 $31,700 The company applies overhead cost to jobs on the basis of machine hours. For the current year, the company estimated that it would work 37.700 machine-hours and incur $163.995 in manufacturing overhead cost. The following transactions were recorded for the year: a. Raw materials were purchased on account: $234.000. b. Raw materials were requisitioned for use in production: $207.000 (85% direct and 15% indirect). c. The following costs were incurred for employee services: Direct labour Indirect labour Sales commissions Administrative salaries $173,600 $ 30,400 $ 41,100 $ 86, 800 d. Heat, power and water costs were incurred in the factory: $49,650. e. Prepaid insurance expired during the year: $18,500 (80% relates to factory operations, and 20% relates to selling and administrative activities). f. Advertising costs were incurred, $58,500. g. Depreciation was recorded for the year: $70,200 (75% relates to factory operations, and 25% relates to selling and administrative activities) authod cost was anplied to production. The company recorded 43,400 machine-hours for the year. Ravsten Company uses a job-order costing system. On January 1, the beginning of the current year, the company's inventory balanc were as follows: Raw materials Work in process Finished goods $24,500 $13,400 $31,700 The company applies overhead cost to jobs on the basis of machine-hours. For the current year, the company estimated that it would work 37,700 machine-hours and incur $163.995 in manufacturing overhead cost. The following transactions were recorded for the year: a. Raw materials were purchased on account: $234,000. b. Raw materials were requisitioned for use in production: $207.000 (85% direct and 15% indirect). c. The following costs were incurred for employee services: Direct labour Indirect labour Sales commissions Administrative salaries $173,600 $ 30,400 $ 41,100 $ 86,800 d. Heat, power, and water costs were incurred in the factory: $49.650. e. Prepaid insurance expired during the year: $18,500 (80% relates to factory operations, and 20% relates to selling and administrative sti d. Heat, power, and water costs were incurred in the factory: $49,650. e. Prepaid insurance expired during the year: $18.500 (80% relates to factory operations, and 20% relates to selling and administrative activities). f. Advertising costs were incurred, $58,500. g. Depreciation was recorded for the year: $70,200 (75% relates to factory operations, and 25% relates to selling and administrative activities). h. Manufacturing overhead cost was applied to production. The company recorded 43,400 machine-hours for the year. i. Goods that cost $534,600 to manufacture according to their job cost sheets were transferred to the finished goods warehouse j. Sales for the year totalled $779,000 and were all on account. The total cost to manufacture these goods according to their job cost sheets was $526,200. Required: 1. Prepare journal entries to record the transactions given above. (Do not round intermediate calculations. 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 6 8 ..... 7 11 Raw materials were purchased on account: $234,000 iew transaction list 1 Raw materials were purchased on account: $234,000. 2 Raw materials were requisitioned for use in production: $207,000 (85% direct and 15% indirect). 3 Record the costs that were incurred for employee services 4 Heat, power, and water costs were incurred in the factory: $49,650. 5 Prepaid insurance expired during the year: $18,500 (80% relates to factory operations, and 20% relates to selling and administrative activities) Note : ==*= * = journal entry has been entered Record entry Clear entry Record entry Clear entry - Prepare an income statement for the year. (Round inte RAVSTEN COMPANY Income Statement For the Year Ended December 31 Selling and administrative expenses: