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
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
I need help getting the Cost of Good Sold. 107,000 is not correct.
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?
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
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education