Required information[The following information applies to the questions displayed below.]Bergo Bay's accounting system generated the following account balances on December 31. The company's managerknows something is wrong with this list of balances because it does not show any balance for Work in Process Inventory,and the accrued factory payroll (Factory Wages Payable) has not been recorded.CashAccounts receivableRaw materials inventoryWork in process inventoryFinished goods inventoryPrepaid rentAccounts payableNotes payableCommon stockRetained earnings (prior year)SalesCost of goods soldFactory overheadGeneral and administrative expensesTotalsDebit$ 77,00046,00028,000Req 4 Income Req 4 BalanceStatementSheetPrepare an income statement.06,0002,000113,00027,00038,000$ 337,000Req 5BERGO BAY COMPANYIncome StatementFor Year Ended December 31CreditThese six documents must be processed to bring the accounting records up to date.Materials requisition 10:Materials requisition 11:Materials requisition 12:Labor time ticket 52:Labor time ticket 53:Labor time ticket 54:$ 10,10013,100$4,100 direct materials to Job 402$ 7,300 direct materials to Job 404$2,000 indirect materials$ 6,000 direct labor to Job 402$ 14,000 direct labor to Job 404.$5,000 indirect laborJobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 100% of direct labor cost.20,00083,000210,8004. Prepare an income statement for the year and a balance sheet as of December 31. Hint: Retained earnings is $128,800 at theend of the current year.5. Assume that the $2,000 on materials requisition 12 should have been direct materials charged to Job 404. Does this error resultin overstatement or understatement of total assets?< Req 4 Income Statement$ 337,000Complete this question by entering your answers in the tabs below.Req 4 Balance Sheet >

Factory overhead It is the costs incurred during the manufacturing process and it is not including…

4. Prepare an income statement for the year and a balance sheet as of December 31. Hint: Retained earnings is $128,800 at the end of the current year. 5. Assume that the $2,000 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result in overstatement or understatement of total assets?

4. Prepare an income statement for the year and a balance sheet as of December 31. Hint: Retained earnings is $128,800 at the end of the current year. 5. Assume that the $2,000 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result in overstatement or understatement of total assets?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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