The company uses a job-order costing system in which overhead is applied to jobs on the basis of direct labor cost. Its predetermined overhead rate is based on a cost formula that estimated $76,500 of manufacturing overhead for an estimated activity level of $45,000 direct labor dollars. At the beginning of the year, the inventory balances were as follows:

During the year, the following transactions were completed:

1. Raw materials purchased on account, $166,000.
2. Raw materials used in production, $142,000 (materials costing $120,000 were charged directly to jobs; the remaining materials were indirect).
3. Costs for employee services were incurred as follows:

1. Rent for the year was $18,700 ($13,400 of this amount related to factory operations, and the remainder related to selling and administrative activities).
2. Utility costs incurred in the factory, $16,000.
3. Advertising costs incurred, $13,000.
4. Depreciation recorded on equipment, $21,000. ($15,000 of this amount related to equipment used in factory operations; the remaining $6,000 related to equipment used in selling and administrative activities.)
5. Manufacturing overhead cost was applied to jobs, $?.
6. Goods that had cost $229,000 to manufacture according to their job cost sheets were completed.
7. Sales for the year (all paid in cash) totaled $504,000. The total cost to manufacture these goods according to their job cost sheets was $215,000.

Raw materials Work in process Finished goods $ 10,500 $ 4,500 $ 8,500 Direct labor Indirect labor Sales commissions Administrative salaries $ 157,000 $ 187,200 $ 27,000 $ 46,000 Raw materials purchased on account, $166,000. Note: Enter debits before credits. Transaction General Journal Debit Credit a. Raw materials used in production, $142,000 (materials costing $120,000 were charged directly to jobs; the remaining materials were indirect). Note: Enter debits before credits. Transaction General Journal Debit Credit b. Cost for employee services incurred as follows: Direct labor $157,000 Indirect labor $187,200 Sales commissions $27,000 Administrative salaries $46,000 Note: Enter debits before credits. Transaction General Journal Debit Credit C. Rent for during the year was $18,700 ($13,400 of this amount related to factory operations, and the remainder related to selling and administrative activities). Note: Enter debits before credits. Transaction General Journal Debit Credit d. Utility cost incurred in the factory, $16,000. Note: Enter debits before credits. Transaction General Journal Debit Credit e. Advertising cost incurred, $13,000. Note: Enter debits before credits. Transaction General Journal Debit Credit f. Depreciation recorded on equipment, $21,000. ($ 15,000 of this amount related to equipment used in factory operations; the remaining $ 6,000 related to equipment used in selling and administrative activities.) Note: Enter debits before credits. Transaction General Journal Debit Credit g. Record the manufacturing overhead cost applied to jobs Note: Enter debits before credits. Transaction General Journal Debit Credit h. Goods that had cost $229,000 to manufacture according to their job cost sheets were completed. Note: Enter debits before credits. Transaction General Journal Debit Credit i. Sales for the year (all paid in cash) totaled $504,000. Note: Enter debits before credits. General Journal Debit Credit Transaction j(1). The total cost to manufacture these goods according to their job cost sheets was $215,000. Note: Enter debits before credits. Transaction General Journal Debit Credit j(2). Raw Materials Work in Process Beg. Bal. Beg. Bal. End. Bal. End. Bal. Finished Goods Manufacturing Overhead Beg. Bal. Beg. Bal. End. Bal. Cost of Goods Sold End. Bal. Beg. Bal. End. Bal. Is Manufacturing Overhead underapplied or overapplied for the year? Underapplied O Overapplied Record the entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold. Note: Enter debits before credits. Transaction General Journal Debit Credit 1 Prepare an income statement for the year. (All of the information needed for th entries and T-accounts you have prepared.) Gold Nest Company Income Statement For the Year Ended Selling and administrative expenses