2. Prepare an income statement. MERIWELL COMPANY Income Statement For the Year Just Completed Sales $ $ 575,000 $ CA Cost of goods sold: Finished goods inventory, beginning Add: Cost of goods manufactured Goods available for sale Deduct: Finished goods inventory, ending Gross margin Less operating expenses: Selling expenses Administrative expenses 35,000 375,100 410,100 (70,000) 340,100 (84,000) (122,000) (575,000) Sales 781,000 3. What was the average cost per unit for direct materials and factory depreciation? (R answers to 2 decimal places.) Average Cost per unit Direct materials Factory depreciation per unit 4-a. Assume that the company expects to produce 20,000 units of product during the coming year. What average cost per unit and what total cost would you expect the company to incur for direct materials at this level of activity? For factory depreciation? (In preparing your answer, assume that direct materials are a variable cost and that depreciation is a fixed cost; also, assume that depreciation is computed on a straight-line basis.) (Round your "Average Cost" answers to 2 decimal places.) Average Cost Total Cost Direct materials Factory depreciation per unit per unit 4-6. Would you expect the average production cost per unit to increase, decrease or stay the same as in the just completed year? Increase Decrease O Remain unchanged Finished goods inventory, beginning Finished goods inventory, ending Depreciation, factory Administrative expenses Utilities, factory Maintenance, factory Supplies, factory Insurance, factory Purchases of raw materials Raw materials inventory, beginning Raw materials inventory, ending Direct labour Indirect labour Work-in-process inventory, beginning Work-in-process inventory, ending Sales Selling expenses $ 35,000 70,000 29,000 122,000 11,000 85,000 13,000 5,600 140,000 13,000 8,000 85,000 13,500 22,000 34,000 575,000 84,000 Various cost and sales data for Meriwell Company for the just completed year, during which it produced 10,000 units, follow: Finished goods inventory, beginning Finished goods inventory, ending Depreciation, factory Administrative expenses Utilities, factory Maintenance, factory Supplies, factory Insurance, factory Purchases of raw materials Raw materials inventory, beginning Raw materials inventory, ending Direct labour Indirect labour Work-in-process inventory, beginning Work-in-process inventory, ending Sales Selling expenses $ 35,000 70,000 29,000 122,000 11,000 85,000 13,000 5,600 140,000 13,000 8,000 85,000 13,500 22,000 34,000 575,000 84,000