What is meant by "tax allocation within a period"? What is the justification for such practices?
1 answer:
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Answer:
Explanation:
Before preparing the income statement, first, we have to compute the net income or net loss. So, the calculation is shown below:
In the simplest form, the net income = Total revenue - total expenses
= Service Revenue - Rent Expense - Maintenance and Repairs Expense - Gasoline Expense - Advertising Expense - Utility Expense
= $6,950 - $1,150 - $600 - $2,250 - $650 - $150
= $2,150
The preparation of the income statement is presented in the spreadsheet. Kindly find the attachment below:
<span>1. what was the cost of raw materials used in production during the year?
The Cost of Raw Materials Used based on the T-account is 110,000
2. how much of the materials in (1) above consisted of indirect materials?
Of the 110,000 Cost of Raw Materials used, 20,000 consists of indirect materials.
110,000 - 90,000 = 20,000
3. how much of the factory labor cost for the year consisted of indirect labor?
The indirect labor of the factory labor cost for the year is 35,000.
185,000 - 150,000 = 35,000.
4. what was the cost of goods manufactured for the year?
The cost of goods manufactured for the year is 470,000. Work-in-Progress T-account.
5. what was the unadjusted cost of goods sold for the year?
The unadjusted Cost of goods sold for the year is 450,000. Finished goods T-account. </span>
The Cost of Raw Materials Used based on the T-account is 110,000
2. how much of the materials in (1) above consisted of indirect materials?
Of the 110,000 Cost of Raw Materials used, 20,000 consists of indirect materials.
110,000 - 90,000 = 20,000
3. how much of the factory labor cost for the year consisted of indirect labor?
The indirect labor of the factory labor cost for the year is 35,000.
185,000 - 150,000 = 35,000.
4. what was the cost of goods manufactured for the year?
The cost of goods manufactured for the year is 470,000. Work-in-Progress T-account.
5. what was the unadjusted cost of goods sold for the year?
The unadjusted Cost of goods sold for the year is 450,000. Finished goods T-account. </span>