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 points Current assets: eBook Cash Accounts receivable Inventories: $71,000 110,000 Print Raw materials (film, costumes) 38,000 30,000 89,000 Videos in process Finished videos awaiting sale 157,000 10,600 348,600 Prepaid insurance Total current assets Studio and equipment 746,000 Less accumulated depreciation Total assets 218,000528,000 $876, 600 Liabilities and Stockholders'Equity $170,600 Accounts payable Capital stock Retained earnings Total liabilities and stockholders'equity $428,000 278,000 706,000 $876, 600 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 company's predetermined overhead rate for the year is based on a cost formula that estimated $282,000 in manufacturing overhead for an estimated allocation base of 6,000 camera-hours. The following transactions occurred during the year: a. Film, costumes, and similar raw materials purchased on account, $193,000. b. Film, costumes, and other raw materials used in production, $208,000(80% of this material was considered direct to the videos in production, and the other 20% was considered indirect). c. Utility costs incurred on account in the production studio, $80,000. d. Depreciation recorded on the studio, cameras, and other equipment, $92,000. 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, $138,000. f. Costs for salaries and wages were incurred on account as follows: Direct labor (actors and directors) Indirect labor (carpenters to build sets, $ 90,000 costume designers, and so forth) Administrative salaries $ 118,000 $ 103,000 g. Prepaid insurance expired during the year, $7,800 (75% related to production of videos, and 25% related to marketing and administrative activities). h. Miscellaneous marketing and administrative expenses incurred on account, $9,400. i. Studio (manufacturing) overhead was applied to videos in production. The company used 7,500 camera-hours during the year j. Videos that cost $558,000 to produce according to their job cost sheets were transferred to the finished videos warehouse to await sale and shipment. k. Sales for the year totaled $941,000 and were all on account. The total cost to produce these videos according to their job cost sheets was $608,000. L Collections from customers during the year totaled $858,000. m. Payments to suppliers on account during the year, $508,000; payments to employees for salaries and wages, $293,000. Req 1 and 2 Req 3 Req 4 Req 5 Req 6 Prepare a T-account for each account on the company's balance sheet and enter the beginning balances. Record the transactions directly into the T- accounts Cash Accounts Receivable Beg. Bal 71,000 858,000 Beg. Bal 941,000 293,000 End. Bal 636,000 End. Bal 941,000 Raw Materials Prepaid Insurance Beg. Bal 38,000 Beg. Bal 10,600 193,000 208,000 7,800 End. Bal 23,000 End. Bal 2,800 Videos in Process Finished Goods Beg. Bal 30,000 166,400 90,000 352,500 Beg. Bal 89,000 558,000 608,000 End. Bal 39,000 558,000 End. Bal 80,900 Studio and Equipment Accumulated Depreciation Beg. Bal Beg. Bal 23,000 92,000 92,000 23,000 End. Bal End. Bal Studio Overhead Depreciation Expense Beg. Bal Beg. Bal 80,000 41,600 118,000 7,800 92,000 23,000 92,000 352,500 92,000 23,000 End. Bal End. Bal 13,100 Insurance Expense Advertising Expense Beg. Bal Beg. Bal 138,000 138,000 Miscellaneous Expense Administrative Salaries Expense Beg. Bal Beg. Bal 9,400 103,000 9,400 End. Bal 103,000 Cost of Goods Sold Sales Beg. Bal Beg. Bal 608,000 941,000 End. Bal 608,000 End. Bal 941,000 Salaries & Wages Payable Accounts Payable Beg. Bal Beg. Bal 170,000 293,000 90,000 118,000 193,000 80,000 138,000 9,400 103,000 End. Bal 85,000 508,000 End. Bal 154,600 Retained Earnings 278,000 Capital Stock 428,000 Beg. Bal. 706,000 508,300 Beg. Bal 428,000 End. Bal 936,300 End. Bal Complete this question by entering your answers in the tabs below. Req 1 and 2Req 3 Is the Studio (manufacturing) Overhead account underapplied or overapplied for the year? Manufacturing overhead was Req 4 Req 5 Req 6 by for the year Req 1 and 2 Req 4 Prepare a schedule of cost of goods manufactured. Supreme Videos, Inc. Schedule of Cost of Goods Manufactured Direct materials: Total raw materials available Raw materials used in production Total manufacturing costs Cost of goods manufactured K Req 3 Req5> Prepare a schedule of cost of goods sold. Supreme Videos, Inc Schedule of Cost of Goods Sold Req 4 Req 6> Prepare an income statement for the year. SUPREME VIDEOS, INC. Income Statement For the Year Ended December 31 Selling and administrative expenses: K Req 5 Req 6