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Bergo Bay's accounting system generated the following account balances on December 31. The company's manager knows 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. Cash Accounts receivable Raw materials inventory Work in process inventory Finished goods inventory Prepaid rent Accounts payable Notes payable Common stock Retained earnings (prior year) Sales Cost of goods sold Debit Credit $ 79,000 48,000 29,000 0 12,000 4,000 $ 9,200 12,200 40,000 82,000 197,600 Factory overhead General and administrative expenses 107,000 27,000 35,000 Totals $ 341,000 $ 341,000 These 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: $ 4,100 direct materials to Job 402 $ 7,400 direct materials to Job 404 $ 2,200 indirect materials $ 6,000 direct labor to Job 402 $ 14,000 direct labor to Job 404 $ 5,000 indirect labor. Jobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 150% of direct labor cost. Problem 15-3A (Algo) Parts 4 and 5 4. Prepare an income statement for the year and a balance sheet as of December 31. Hint: Retained earnings is $133,400 at the end of the current year. 5. Assume that the $2,200 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result in overstatement or understatement of total assets? Prepare an income statement. BERGO BAY COMPANY Income Statement For Year Ended December 31 Sales Cost of goods sold Gross profit General and administrative expenses Net income $ 197,600 107,000 × 90,600 35,000 69 55,600

Bergo Bay's accounting system generated the following account balances on December 31. The company's manager knows 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. Cash Accounts receivable Raw materials inventory Work in process inventory Finished goods inventory Prepaid rent Accounts payable Notes payable Common stock Retained earnings (prior year) Sales Cost of goods sold Debit Credit $ 79,000 48,000 29,000 0 12,000 4,000 $ 9,200 12,200 40,000 82,000 197,600 Factory overhead General and administrative expenses 107,000 27,000 35,000 Totals $ 341,000 $ 341,000 These 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: $ 4,100 direct materials to Job 402 $ 7,400 direct materials to Job 404 $ 2,200 indirect materials $ 6,000 direct labor to Job 402 $ 14,000 direct labor to Job 404 $ 5,000 indirect labor. Jobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 150% of direct labor cost. Problem 15-3A (Algo) Parts 4 and 5 4. Prepare an income statement for the year and a balance sheet as of December 31. Hint: Retained earnings is $133,400 at the end of the current year. 5. Assume that the $2,200 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result in overstatement or understatement of total assets? Prepare an income statement. BERGO BAY COMPANY Income Statement For Year Ended December 31 Sales Cost of goods sold Gross profit General and administrative expenses Net income $ 197,600 107,000 × 90,600 35,000 69 55,600

FINANCIAL ACCOUNTING
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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I need help getting the Cost of Good Sold. 107,000 is not correct. 

Bergo Bay's accounting system generated the following account balances on December 31. The company's manager knows 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. Cash Accounts receivable Raw materials inventory Work in process inventory Finished goods inventory Prepaid rent Accounts payable Notes payable Common stock Retained earnings (prior year) Sales Cost of goods sold Debit Credit $ 79,000 48,000 29,000 0 12,000 4,000 $ 9,200 12,200 40,000 82,000 197,600 Factory overhead General and administrative expenses 107,000 27,000 35,000 Totals $ 341,000 $ 341,000 These 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: $ 4,100 direct materials to Job 402 $ 7,400 direct materials to Job 404 $ 2,200 indirect materials $ 6,000 direct labor to Job 402 $ 14,000 direct labor to Job 404 $ 5,000 indirect labor. Jobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 150% of direct labor cost. Problem 15-3A (Algo) Parts 4 and 5 4. Prepare an income statement for the year and a balance sheet as of December 31. Hint: Retained earnings is $133,400 at the end of the current year. 5. Assume that the $2,200 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result in overstatement or understatement of total assets?
Transcribed Image Text:Bergo Bay's accounting system generated the following account balances on December 31. The company's manager knows 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. Cash Accounts receivable Raw materials inventory Work in process inventory Finished goods inventory Prepaid rent Accounts payable Notes payable Common stock Retained earnings (prior year) Sales Cost of goods sold Debit Credit $ 79,000 48,000 29,000 0 12,000 4,000 $ 9,200 12,200 40,000 82,000 197,600 Factory overhead General and administrative expenses 107,000 27,000 35,000 Totals $ 341,000 $ 341,000 These 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: $ 4,100 direct materials to Job 402 $ 7,400 direct materials to Job 404 $ 2,200 indirect materials $ 6,000 direct labor to Job 402 $ 14,000 direct labor to Job 404 $ 5,000 indirect labor. Jobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 150% of direct labor cost. Problem 15-3A (Algo) Parts 4 and 5 4. Prepare an income statement for the year and a balance sheet as of December 31. Hint: Retained earnings is $133,400 at the end of the current year. 5. Assume that the $2,200 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result in overstatement or understatement of total assets?
Prepare an income statement. BERGO BAY COMPANY Income Statement For Year Ended December 31 Sales Cost of goods sold Gross profit General and administrative expenses Net income $ 197,600 107,000 × 90,600 35,000 69 55,600
Transcribed Image Text:Prepare an income statement. BERGO BAY COMPANY Income Statement For Year Ended December 31 Sales Cost of goods sold Gross profit General and administrative expenses Net income $ 197,600 107,000 × 90,600 35,000 69 55,600
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