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Supreme Videos, Incorporated, produces short musical videos for sale to retail outlets. The company's balance sheet accounts as of January 1 , are given below. Because the videos differ in length and in complexity of production, the company uses a job-order costing system to determine the cost of each video produced. Studio (manufacturing) overhead is charged to videos on the basis of camera-hours of activity. The company's predetermined overhead rate for the year is based on a cost formula that estimated $200,000 in manufacturing overhead for an estimated allocation base of 5,000 camera-hours. The following transactions occurred during the year: a. Film, costumes, and similar raw materials purchased on account, $199.000. b. Film, costumes, and other raw materials used in production, $214,000 (75\% of this material was considered direct to the videos in production, and the other 25% was considered indirect). c. Utilitv costs incurred in the oroduction studio. $86.000. a. Film, costumes, and similar raw materials purchased on account, $199,000, b. Film, costumes, and other raw materials used in production, $214,000 (75\% of this material was considered direct to the videos in production, and the other 25% was considered indirect). c. Utility costs incurred in the production studio, $86,000. d. Depreciation recorded on the studio, cameras, and other equipment, $98,00,0. Three fourths of this depreciation related to production of the videos, and the remainder related to equipment used in marketing and administration. e. Advertising expense incurred on account, $144,000. f. Costs for salaries and wages were incurred as follows: 9. Prepaid insurance expired during the year, $8,400 (70\% related to production of videos, and 30% related to marketing and administrative activities). h. Miscellancous marketing and administrative expenses incurred, $10,000. i. Studio (manufacturing) overhead was applied to videos in production. The company used 9,000 camera-hours during the year. j. Videos that cost $564,000 to produce according to their job cost sheets were transferred to the finished videos warehouse to await sale and shipment. k. Sales for the year totaled $953,000 and were all on account. The total cost to produce these videos according to their job cost sheets was $614,000 1. Collections from customers during the year totaled $864,000 m. Payments to suppliers on account during the year, $514,000 : payments to employees for salaries and wages, $321,000. Required: 1. Prepare a T-account for each account on the company's balance sheet and enter the beginning balances. 2. Record the transactions directly into the T-accounts. Key your entries to the letters (a) through (m) above. 3. Is the Studio (manufacturing) Overhead account underapplied or overapplied for the year? By how much? 4. Prepare a schedule of cost of goods manufactured. 5. Prepare a schedule of cost of goods sold 6. Prepare an income statement for the year