Required information

Problem 15-2A Source documents, journal entries, overhead, and financial reports LO P1, P2, P3, P4

[The following information applies to the questions displayed below.] Bergamo Bay's computer system generated the following trial balance on December 31, 2017. The companys manager knows something is wrong with the trial balance because it does not show any balance for Work in Process Inventory but does show a balance for the Factory Overhead account. In addition, the accrued factory payroll (Factory Payroll Payable) has not been recorded.

		Debit			Credit
Cash	$	66,000
Accounts receivable		42,000
Raw materials inventory		26,000
Work in process inventory		0
Finished goods inventory		6,000
Prepaid rent		2,000
Accounts payable				$	8,700
Notes payable					11,700
Common stock					20,000
Retained earnings					82,000
Sales					225,600
Cost of goods sold		119,000
Factory overhead		32,000
Operating expenses		55,000
Totals	$	348,000		$	348,000

After examining various files, the manager identifies the following six source documents that need to be processed to bring the accounting records up to date.

Materials requisition 21-3010:		$	4,100	direct materials to Job 402
Materials requisition 21-3011:		$	8,000	direct materials to Job 404
Materials requisition 21-3012:		$	1,800	indirect materials
Labor time ticket 6052:		$	1,000	direct labor to Job 402
Labor time ticket 6053:		$	14,000	direct labor to Job 404
Labor time ticket 6054:		$	3,000	indirect labor

Jobs 402 and 404 are the only units in process at year-end. The predetermined overhead rate is 100% of direct labor cost.

Problem 15-2A Part 1

Direct materials costs to Work in Process Inventory.

Direct labor costs to Work in Process Inventory.

Overhead costs to Work in Process Inventory.

Indirect materials costs to the Factory Overhead account.

Indirect labor costs to the Factory Overhead account.

Required: 1. Prepare journal entries to assign the above costs.

2.1 Determine the revised balance of the Factory Overhead account after making the entries in part 1 using T-accounts. Determine whether there is any under- or overapplied overhead for the year.

Problem 15-2A Part 3

3. Prepare a revised trial balance.

Problem 15-2A Part 4

4. Prepare an income statement for 2017 and a balance sheet as of December 31, 2017.