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 $ 16,400 Work in process $ 10,400 Finished goods $ 30,800 The company applies overhead cost to jobs on the basis of machine-hours. For the current year, the company estimated that it would work 36,000 machine-hours and incur $154,440 in manufacturing overhead cost. The following transactions were recorded for the year: Raw materials were purchased on account: $202,000. Raw materials were requisitioned for use in production: $192,000 (80% direct and 20% indirect). The following costs were incurred for employee services: Direct labour $ 162,000 Indirect labour $ 27,400 Sales commissions $ 36,400 Administrative salaries $ 80,800 Heat, power, and water costs were incurred in the factory: $42,400. Prepaid insurance expired during the year: $10,400 (90% relates to factory operations, and 10% relates to selling and administrative activities). Advertising costs were incurred, $50,400. Depreciation was recorded for the year: $60,400 (85% relates to factory operations, and 15% relates to selling and administrative activities). Manufacturing overhead cost was applied to production. The company recorded 40,000 machine-hours for the year. Goods that cost $484,800 to manufacture according to their job cost sheets were transferred to the finished goods warehouse. Sales for the year totalled $714,000 and were all on account. The total cost to manufacture these goods according to their job cost sheets was $479,000. Required: 1. Prepare journal entries to record the transactions given above. 2. Prepare T-accounts for inventories, Manufacturing Overhead, and Cost of Goods Sold. Post relevant data from your journal entries to these T-accounts (dont forget to enter the opening balances in your inventory accounts). Compute an ending balance in each account. 3-a. Is manufacturing overhead underapplied or overapplied for the year? multiple choice Underapplied overhead Overapplied overhead 3-b. Prepare a journal entry to properly dispose of any balance in the Manufacturing Overhead account. 4. Prepare an income statement for the year