Required information

$[$The following information applies to the questions displayed below.$]$

Bergo Bay's accounting system generated the following account balances on December $31.$ The company's manager

knows something is wrong with this list of balances because it does not show any balance for Work in Process Inventory,

and the accrued factory payroll $($Factory Wages Payable$)$ has not been recorded.

These six documents must be processed to bring the accounting records up to date.

Materials requisition $10$: $$4,500$ direct materials $to$ Job $402$

Materials requisition $11$: $$7,400$ direct materials $to$ Job $404$

Materials requisition $12$: $$2,400$ indirect materials

Labor time ticket $52$: $$6,000$ direct labor $to$ Job $402$

Labor time ticket $53$: $$14,000$ direct labor $to$ Job $404$

Labor time ticket $54$: $$5,000$ indirect labor

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

Prepare an income statement for the year and a balance sheet as of December $31.$ Hint: Retained earnings is $$96,900$ at the end

of the current year.

Assume that the $$2,400$ on materials requisition $12$ should have been direct materials charged to Job $404.$ Does this error result

in overstatement or understatement of total assets?

Complete this question by entering your answers in the tabs below.

Req $4$ Income

Prepare an income statement.