The Gorilla Company manufactures small stuffed gorillas. The total revenue is $59,000. The company incurred the following costs:

There were no units still in process at the end of the year, and 92% of the goods produced during the year were sold.
Required:
a Compute what the net income or loss would be if there were no distinction between product and period costs, and Gorilla Company was on a cash basis.
b Show the analysis that should have been prepared.
c¢ Compute the correct net income or loss .9122

Transcribed Image Text:

Materials Labor.. Factory overhead General and administrative expenses.. Office salaries Equipment purchased at end of period (ignore depreciation). Total.... $ 5.200 (10% is indirect materials) 7,000 (12% is indirect labor) 25,000 (including indirect materials and indirect labor) 14,700 4.800 5,300 $62,000