Answer:
Instructions are listed below
Explanation:
Giving the following information:
Sales $ 654,000
Direct labor cost $ 88,000
Raw material purchases $ 135,000
Selling expenses $ 107,000
Administrative expenses $ 42,000
Manufacturing overhead applied to work in process $ 200,000
Actual manufacturing overhead costs $ 225,000
Inventories Beginning Raw materials $ 8,800
Ending inventories Raw materials $ 10,800
Beginning Work in process $ 6,000
Ending Work in process $ 20,400
Beginning Finished goods $ 79,000
Ending finished goods $ 25,000
1) cost of goods manufactured:
Beginning Work in process $ 6,000
Inventories Beginning Raw materials $ 8,800
Raw material purchases $ 135,000
Ending inventories Raw materials $ 10,800 (-)
Direct labor cost $ 88,000
Manufacturing overhead applied to work in process $ 200,000
Ending Work in process $ 20,400 (-)
Total= $406,600
2) Cost of goods sold:
Beginning Finished goods $ 79,000
cost of goods manufactured $406,600
Ending finished goods $ 25,000 (-)
Underapplied overhead= 25,000 (+)
Total COGS= $485,600
3) Income statement:
Sales= 654,000
COGS= 485,600
Gross income= $168,400
Selling expenses $ 107,000
Administrative expenses $ 42,000
Net operating income= $19,400
