Star Videos, Inc., produces short musical videos for sale to retail outlets. The companys balance sheet accounts as of January 1 are given below.

Star Videos, Inc.
Balance Sheet
January 1
Assets
Cash				$	81,800
Accounts receivable					104,400
Inventories:
Raw materials (film, costumes)	$	17,200
Videos in process		57,400
Finished videos awaiting sale		85,800			160,400
Prepaid insurance					12,650
Studio and equipment (net)					588,000
Total assets				$	947,250
Liabilities and Stockholders Equity
Accounts payable				$	203,000
Retained earnings					744,250
Total liabilities and stockholders equity				$	947,250

Because the videos differ in length and in complexity of production, the company uses a job-order costing system to determine the cost of each video produced. Studio (manufacturing) overhead is charged to videos on the basis of camera-hours of activity. The companys predetermined overhead rate for the year ($40 per camera-hour) is based on a cost formula that estimated $280,000 in manufacturing overhead for an estimated allocation base of 7,000 camera-hours. Any underapplied or overapplied overhead is closed to cost of goods sold. The following transactions were recorded for the year:

1. Film, costumes, and similar raw materials purchased on account, $195,500.
2. Film, costumes, and other raw materials issued to production, $209,500 (85% of this material was considered direct to the videos in production, and the other 15% was considered indirect).
3. Utility costs incurred (on account) in the production studio, $85,800.
4. Depreciation recorded on the studio, cameras, and other equipment, $106,000. Three-fourths of this depreciation related to actual production of the videos, and the remainder related to equipment used in marketing and administration.
5. Advertising expense incurred (on account), $175,000.
6. Salaries and wages paid in cash as follows:

Direct labor (actors and directors)	$	89,200
Indirect labor (carpenters to build sets, costume designers, and so forth)	$	82,500
Administrative salaries	$	112,800

7. Prepaid insurance expired during the year, $9,950 (70% related to production of videos, and 30% related to marketing and administrative activities).
8. Miscellaneous marketing and administrative expenses incurred (on account), $10,350.
9. Studio (manufacturing) overhead was applied to videos in production. The company recorded 7,250 camera-hours of activity during the year.
10. Videos that cost $566,000 to produce according to their job cost sheets were transferred to the finished videos warehouse to await sale and shipment.
11. Sales for the year totaled $1,000,000 and were all on account.
12. The total cost to produce the videos that were sold according to their job cost sheets was $611,070.
13. Collections from customers during the year totaled $950,000.
14. Payments to suppliers on account during the year, $556,000.
15. Underapplied or overapplied overhead $__?__.

Required:

1. Prepare a transaction analysis that records all of the above transactions.

2. Prepare a schedule of cost of goods manufactured for the year.

3. Prepare a schedule of cost of goods sold for the year.

4. Prepare an income statement for the year.