Froya Fabrikker A/S of Bergen, Norway, Is a small company that manufactures specialty heavy equipment for use In North Sea oil fields. The company uses a job-order costing system that applies manufacturing overhead cost to jobs on the basis of direct labor- hours. Its predetermined overhead rate was based on a cost formula that estimated $395,600 of manufacturing overhead for an estimated allocation base of 920 direct labor-hours. The following transactions took place during the year:a. Raw materials purchased on account, $290,000.b. Raw materials used In production (all direct materials), $275,000.c. Utility bills incurred on account, $77,000 (90% related to factory operations, and the remainder related to selling and administrative activities).d. Accrued salary and wage costs:Direct labor (970 hours) $320,000Indirect labor $108,000Selling and administrative salaries $200,000e. Maintenance costs incurred on account in the factory, $72,000.f. Advertising costs incurred on account, $154,000.g. Depreciation was recorded for the year, $90,000 (75% related to factory equipment, and the remainder related to selling and administrative equipment)h. Rental cost incurred on account, $115,000 (80% related to factory facilities, and the remainder related to selling and administrative facilities).i. Manufacturing overhead cost was applied to jobs, $ j. Cost of goods manufactured for the year, $950,000.k. Sales for the year (ail on account) totaled $2.100.000. These goods cost $980.000 according to their job cost sheets. The balances in the inventory accounts at the beginning of the year were:Raw Materials $48,000Work in Process $39,000Finished Goods $78,000Required:1. Prepare journal entries to record the preceding transactions.2. Post your entries to T-accounts. (Don't forget to enter the beginning Inventory balances above.)3. Prepare a schedule of cost of goods manufactured.4A. Prepare a journal entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold.4B. Prepare a schedule of cost of goods sold. 5. Prepare an income statement for the year.

NOTE:

Missing Information:

d. Accrued salary and wage costs:

Direct labor (970 hours) $320,000

Indirect labor $108,000

Selling and administrative salaries $200,000

e. Maintenance costs incurred on account in the factory, $72,000.

f. Advertising costs incurred on account, $154,000.

g. Depreciation was recorded for the year, $90,000 (75% related to factory equipment, and the remainder related to selling and administrative equipment)

h. Rental cost incurred on account, $115,000 (80% related to factory facilities, and the remainder related to selling and administrative facilities).

i. Manufacturing overhead cost was applied to jobs, $ _____

j. Cost of goods manufactured for the year, $950,000.

k. Sales for the year (ail on account) totaled $2.100.000. These goods cost $980.000 according to their job cost sheets.

Schedule of goods sold and income statement of the year.

a) raw materials 220,000 debit

        accounts payable    220,00 credit

b) WIP 205,000 debit

     raw materials  205,000 credit

c) factory overhead   56,700 debit

  utilities expense       6,300 debit

         utilities payable    63,000  credit

d) WIP 320,000 debit

  Factory overhead 108,000 debit

  salaries expense  200,000 debit  salaries and wages payables   628,000 credit

e) factory overhead   72,000 debit

                  cash 72,000 credit

f) advertizing expense 154,000 debit

                       cash 154,000 credit

g) factory overhead 67,500 debit

   depreciation expense  22,500 debit

  acc depreciation- equipment       90,000 credit

h) factory overhead    92,000 debit

  rent expense    23,000 debit

          cash      115,000 credit

i)   WIP (970 hours x $380 per DHL) = 368,600 debit 

 factory overhead      368,600 credit

j) finished goods 950,000 debit

         WIP   950,000 credit

k) account receivables 2,100,000 debit

 sales revenues  2,100,000 credit

   cost of goods sold  980,000 debit

  finished goods  980,000 credit

Explanation:

The attachment below shows the step-by-step explanation to the question

two years ago, when picking flowers in the mountains back of yosemite valley, i found a book. it was blotted and storm-beaten; all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however; many of the inner pages were well preserved. and although all were more or less stained and torn, whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today; its granite pages have been torn and blurred by the same storms that wasted the castaway book.

two years ago, when picking flowers in the mountains back of yosemite valley; i found a book. it was blotted and storm-beaten, all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however, many of the inner pages were well preserved. and although all were more or less stained and torn; whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today, its granite pages have been torn and blurred by the same storms that wasted the castaway book.