Ravsten Company uses a job order costing system On January 1, the beginning of the current year, the companys inventory balances were as follows Raw materials $ 25,000 Work in process $ 13,600 Finished goods $ 31,800 The company applies overhead cost to jobs on the basis of machine hours For the current year, the company estimated that it would work 37,800 machine hours and incur $166,320 in manufacturing overhead cost The following transactions were recorded for the year Raw materials were purchased on account $236,000 Raw materials were requisitioned for use in production $208,000 (85 direct and 15 indirect) The following costs were incurred for employee services Direct labour $ 174,400 Indirect labour $ 30,600 Sales commissions $ 41,400 Administrative salaries $ 87,200 Heat, power, and water costs were incurred in the factory $50,100 Prepaid insurance expired during the year $19,000 (80 relates to factory operations, and 20 relates to selling and administrative activities) Advertising costs were incurred, $59,000 Depreciation was recorded for the year $70,800 (75 relates to factory operations, and 25 relates to selling and administrative activities) Manufacturing overhead cost was applied to production The company recorded 43,600 machine hours for the year Goods that cost $539,200 to manufacture according to their job cost sheets were transferred to the finished goods warehouse Sales for the year totalled $783,700 and were all on account The total cost to manufacture these goods according to their job cost sheets was $530,600 2 Prepare T accounts for inventories, Manufacturing Overhead, and Cost of Goods Sold Post relevant data from your journal entries to these T accounts (don't forget to enter the opening balances in your inventory accounts) Compute an ending balance in each account Raw Materials Manufacturing Overhead Beg Bal Beg Bal End Bal End B Work in Process Cost of Goods Sold Beg Bal Beg Ba End Bal End Bal Finished Goods Beg Bal End Bal 3 a Is manufacturing overhead underapplied or overapplied for the year

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Ravsten Company uses a job-order costing system. On January 1, the beginning of the current year, the companys inventory balances were as follows: Raw materials

Ravsten Company uses a job-order costing system. On January 1, the beginning of the current year, the companys inventory balances were as follows:


Raw materials	$	25,000
Work in process	$	13,600
Finished goods	$	31,800

The company applies overhead cost to jobs on the basis of machine-hours. For the current year, the company estimated that it would work 37,800 machine-hours and incur $166,320 in manufacturing overhead cost. The following transactions were recorded for the year:

Raw materials were purchased on account: $236,000.
Raw materials were requisitioned for use in production: $208,000 (85% direct and 15% indirect).
The following costs were incurred for employee services:


Direct labour	$	174,400
Indirect labour	$	30,600
Sales commissions	$	41,400
Administrative salaries	$	87,200

Heat, power, and water costs were incurred in the factory: $50,100.
Prepaid insurance expired during the year: $19,000 (80% relates to factory operations, and 20% relates to selling and administrative activities).
Advertising costs were incurred, $59,000.
Depreciation was recorded for the year: $70,800 (75% relates to factory operations, and 25% relates to selling and administrative activities).
Manufacturing overhead cost was applied to production. The company recorded 43,600 machine-hours for the year.
Goods that cost $539,200 to manufacture according to their job cost sheets were transferred to the finished goods warehouse.
Sales for the year totalled $783,700 and were all on account. The total cost to manufacture these goods according to their job cost sheets was $530,600.

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2. Prepare T-accounts for inventories, Manufacturing Overhead, and Cost of Goods Sold. Post relevant data from your journal entries to these T-accounts (don't forget to enter the opening balances in your inventory accounts). Compute an ending balance in each account Raw Materials Manufacturing Overhead Beg. Bal. Beg. Bal. End. Bal. End. B Work in Process Cost of Goods Sold Beg. Bal. Beg. Ba End. Bal End. Bal. Finished Goods Beg. Bal. End. Bal. 3-a. Is manufacturing overhead underapplied or overapplied for the year