Farina Bay€™s computer system generated the following trial balance on December 31, 2013. The company€™s manager knows something is wrong with the trial balance because it does not show any balance for Goods in Process Inventory but does show balances for the Factory Payroll and Factory Overhead accounts.

After examining various files, the manager identifies the following six source documents that need to be processed to bring the accounting records up to date.
Materials requisition 21- 3010: .... $ 10,200 direct materials to Job 402
Materials requisition 21- 3011: .... $ 18,600 direct materials to Job 404
Materials requisition 21- 3012: .... $ 5,600 indirect materials
Labor time ticket 6052: ....... $ 36,000 direct labor to Job 402
Labor time ticket 6053: ....... $ 23,800 direct labor to Job 404
Labor time ticket 6054: ....... $ 8,200 indirect labor

Jobs 402 and 404 are the only units in process at year- end. The predetermined overhead rate is 200% of direct labor cost.

Required
1. Use information on the six source documents to prepare journal entries to assign the following costs.
a. Direct materials costs to Goods in Process Inventory.
b. Direct labor costs to Goods in Process Inventory.
c. Overhead costs to Goods in Process Inventory.
d. Indirect materials costs to the Factory Overhead account.
e. Indirect labor costs to the Factory Overhead account.
2. Determine the revised balance of the Factory Overhead account after making the entries in part 1. Deter-mine whether there is any under-or overapplied overhead for the year. Prepare the adjusting entry to al-locate any over-or underapplied overhead to Cost of Goods Sold, assuming the amount is not material.
3. Prepare a revised trial balance.
4. Prepare an income statement for year 2013 and a balance sheet as of December 31, 2013.
Analysis Component
5. Assume that the $ 5,600 on materials requisition 21-3012 should have been direct materials charged to Job 404. Without providing specific calculations, describe the impact of this error on the income statement for 2013 and the balance sheet at December 31,2013.

Debit Credit Cash Accounts receivable Raw materials inventory $102.000 .. .. 75,000 80,000 Goods in process inventory Finished goods inventory. 15,000 3,000 Prepaid rent ...*... 17,000 25.000 50,000 271,000 373,000 Accounts Notes payable. Sales Cost of goods sold..218,000 Factory payroll .. 68.000 115,000 overhead Operating expenses .