Supreme Videos, Inc., produces short musical videos for sale to retail outlets. The company's balance sheet accounts as of January 1, are given below Supreme Videos, Inc. Balance Sheet January 1 Assets Current assets: Cash S 63,000 Accounts receivable 102,000 Inventories: Raw materials (film, costumes) $ 30,000 Videos in process 45,000 Finished videos awaiting sale 81,000 156,000 Prepaid insurance 9,000 Total current assets 330,000 studio and equipment 730,000 Les accumulated depreciation 210.000 520,000 Total assets $850,000 Liabilities and stockholders Equity Accounts payable $160,000 Capital stock $420,000 Retained earnings 270,000 690,000 Total liabilities and S850,000 stockholders equity Because the videos differ in longth 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 company's predetermined overhead rate for the year is based on a cost formula that estimated $280,000 in manufacturing overhead for an estimated allocation base of 7.000 camera hours. The following transactions occurred during the year a Film, costumes, and similar raw materials purchased on account, $185,000. b. Film, costumes, and other raw materials used in production, $200,000 (85% of this material was considered direct to the videos in production, and the other 15% was considered indirect) c. Utility costs incurred on account in the production studio, $72,000. d. Depreciation recorded on the studio, cameras, and other equipment. $84,000. Three-fourths of this depreciation related to production of the videos, and the remainder related to equipment used in marketing and administration e Advertising expense incurred on account, $130,000 f. Costs for salaries and wages were incurred on account as follows: $ 82,000 Direct labor (actors and directors) Indirect labor (carpenters to build sets, costume designers, and so forth) Administrative salaries $110,000 $ 95,000 g Prepaid insurance expired during the year, $7,000 (80% related to production of videos, and 20% related to marketing and administrative activities) h Miscellaneous marketing and administrative expenses incurred on account, $8,600 Studio (manufacturing) overhead was applied to videos in production. The company used 7250 camera-hours during the year Videos that cost $550,000 to produce according to their job cost sheets were transferred to the finished videos warehouse to await sole and shipment k Sales for the year totaled $925,000 and were all on account The total cost to produce these videos according to their job cost sheets was $600,000 Collections from customers during the year totaled $850,000, m Payments to suppliers on account during the year $500,000, payments to employees for salaries and wages, $285,000 Required: 1. Prepare a T account for each account on the company's balance shoot and enter the beginning balances 2. Record the transactions directly into the accounts 3. Is the Studio (manufacturing) Overhead account underapplied or overappood for the year? 4 Prepare a schedule of cost of goods manufactured 5. Prepare a schedule of cost of goods sold 6. Prepare an income statement for the year