4. Prepare an income statement for the year and a balance sheet as of December 31 . Hint: Retained earnings is $132,900 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? Complete this question by entering your answers in the tabs below. Prepare an income statement. 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. These six documents must be processed to bring the accounting records up to date. 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 on the balance sheet at December 31 ? Does this error result in overstatement or understatement of total assets