A. Prepare a schedule of cost of goods manufactured. Assume all raw materials used in production were direct materials.

Mason Company
Schedule of Cost of Goods Manufactured
Beginning work in process inventory
Direct materials:
Beginning raw materials inventory
Add: Purchases of raw materials
Total raw materials available
Less: Ending raw materials inventory
Direct materials used in production
Direct labor
Manufacturing overhead
Total manufacturing costs added to production
Total manufacturing costs to account for
Less: Ending work in process inventory
Cost of goods manufactured

B. Prepare a schedule of cost of goods sold. Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold.

Mason Company
Schedule of Cost of Goods Sold
Beginning finished goods inventory
Add: Cost of goods manufactured
Cost of goods available for sale
Less: Ending finished goods inventory
Unadjusted cost of goods sold
Less: Overapplied overhead
Adjusted cost of goods sold

C.

Prepare an income statement.

Mason Company
Income Statement
Sales
Cost of goods sold
Gross margin
Selling and administrative expenses:
Selling expenses
Administrative expense
Net operating income		$

The following data from the just completed year are taken from the accounting records of Mason Company: Sales Direct labor cost Raw material purchases Selling expenses Administrative expenses Manufacturing overhead applied to work in process Actual manufacturing overhead costs $ 651,000 $ 89,000 $ 131,000 $ 108,000 $ 44,000 $ 222,000 $ 203,000 Inventories Raw materials Work in process Finished goods Beginning $ 8,300 $ 5,300 $ 79,000 Ending $ 10,600 $ 20,200 $ 25,400 Required: 1. Prepare a schedule of cost of goods manufactured. Assume all raw materials used in production were direct materials. 2. Prepare a schedule of cost of goods sold. Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold. 3. Prepare an income statement