Answer:
Instructions are listed below
Explanation:
A) First, we need to accommodate the information for better understanding:
Direct Materials=
Beginning Raw MaterialsInventory $48,000
Raw Materials Purchases $96,400
Ending Materials Inventory $39,600
Direct Labor $139,250
Manufacturing overhead=
Factory Insurance $4,600
Factory MachineryDepreciation $16,000
Office Utilities Expense $8,650
Plant Managers Salary $58,000
Indirect Labor $24,460
Factory Property Taxes $9,600
Factory Repairs $1,400
Factory Utilities $27,600
Work in ProgressInventory 7/1/13 $19,800
Work In ProgressInventory 6/30/14 $18,600
To calculate the cost of manufactured goods we need to use the following formula:
Cost of good manufactured= Beginning work in progress+ direct materials of the period + direct labor + manufactured overhead - ending work in progress
Cost of good manufactured= 19800+(48000+96400-39600)+ 139250+(4600+16000+8650+58000+24460+9600+1400+27600)-18600=$395560
B)The general structure of an income statement proceeds as follow:
Revenue/Sales (+)
Cost of Goods Sold (COGS) (-)
=Gross Profit
Marketing, Advertising, and Promotion Expenses (-)
General and Administrative (G&A) Expenses (-)
=EBITDA
Depreciation & Amortization Expense (-)
=Operating Income or EBIT
Interest (-)
Other Expenses (-)
=EBT (Pre-Tax Income)
Income Taxes (-)
=Net Income
First, we need to calculate the cost of goods sold
COGS=Beginning Inventory+Production during period−Ending Inventory=96000+395560-75900=$415660
Revenue= 534000
Sales Discounts= 4200
COGS=415660
Gross profit=$114140
C)
Assets:
Cash $32,000
Accounts Receivable $27,000
Inventories:
Ending Inventory=75900
ending work in progress=18600
Ending Materials Inventory=39600
Total current assets= $193100
