1. As one step in gathering data for a recommendation to the president, prepare a schedule of cost of goods manufactured for June.

eekay Company was organlzed on November 1 of the prevlous year. After seven months of start-up losses, management had expected to earn a profit during June, the most recent month. Management was disappolnted, however, when the Income statement or June also showed a loss. June's Income statement follows: VEEKAY COMPANY Incone Statenent For the Month Ended June 38 Sales $ 742,588 Less operating expenses: Selling and administrative salaries Rent on facilities Purchases of raw materials Insurance Depreciation, sales equipment Utilities costs Indirect labour Direct Labour Depreciation, factory equipnent Maintenance, factory Advertising $ 43,488 51,808 242,888 11,198 12,658 63,888 127,800 186,780 15,288 9,188 94,608 777,358 Operating loss (34,858) After seeing the $34.850 loss for June, Veekay's president stated, was sure we'd be profitable within six months, but after eight months we're stll spilling red Ink. Maybe it's time for us to throw In the towel.To make maters worse, I Just heard that Debbie won't be ack from her surgery for at least slx more weeks. Debble is the company's ccntroller, In her absence, the statement above was prepared by a new assistant who has had Iittle xperience In manufacturing operations. Additional Information about the company follows: Only 85% of the rent on fac lities applies to factory operations; the remainder applies to selling and administrative activities. b. Inventory balances at the beginning and end of June were as follos: Raw nater ials Hork in process Finished goods June 1 June 3e $20,1e0 $78,65 $97,85e $23,320 $50,950 $72,27e Some 90% of the insurance and 80% of the utilities cost apply to factory operations; the remaining am ounts apply to selling and Required: 1. As one step in gathering data for a recommendation to the president, prepare a s VEEKAY COMPANY Schedule of Cost of Goods Manufactured For the Month Ended June 30 Direct materials Manufacturing overhead: Total overhead costs Total manufacturing costs Cost of goods manufactured 2. As a second step, prepare a new income statement for the month. VEEKAY COMPANY Income Statement For the Month Ended June 30 Cost of goods sold Selling and administrative expenses