Supreme Videos, Incorporated, produces short musical videos for sale to retail outlets. The company's balance sheet accounts as of January 1, are given below. Supreme Videos, Incorporated Balance Sheet January 1 Assets Current assets: Cash Accounts receivable Inventories: Raw materials (film, costumes) Videos in process Finished videos awaiting sale Prepaid insurance Total current assets Studio and equipment Less accumulated depreciation Total assets Liabilities and Stockholders' Equity $ 69,000 108,000 $ 36,000 51,000 87,000 174,000 10,200 742,000 216,000 361,200 526,000 $ 887,200 Accounts payable $ 185,200 Capital stock Retained earnings $ 426,000 276,000 702,000 Total liabilities and stockholders' equity $ 887,200 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 $200,000 in manufacturing overhead for an estimated allocation base of 4,000 camera-hours. The following transactions occurred during the year: a. Film, costumes, and similar raw materials purchased on account, $191,000. b. Film, costumes, and other raw materials used in production, $206,000 (75% of this material was considered direct to the videos in production, and the other 25% was considered indirect). c. Utility costs incurred in the production studio, $78,000. d. Depreciation recorded on the studio. cameras. and other equipment. $90.000. Three-fourths of this depreciation related to < Prev 2 of 2 Next >