Calculator Printem Income Statement, Cost of Services Provided, Service Attributes Mason, Durant, and Westbrook (MOW) is a tax services firm. The form is located in Oklahoma City and employs 15 professionals and eight staff. The firm does tax work for small businesses and well-to-do Individuals. The following data are provided for the last fiscal year (The Mason, Durant, and Westbrookfiscal year runs from July 1 through June 30.) Returns processed 3,000 Returns in process, beginning of year $45,000 Returns in process, end of year 12,000 Cost of services sold Beginning direct materials inventory 1,581,000 20,000 40,000 Purchases, direct materials 1,400,000 Direct labor Overhead Administrative expenses 100,000 258,000 65,000 Selling expenses Required: 1. Prepare a statement of cost of services sold Mason, Durant and Westbrook Provos ree) 2 Printem 1. Prepare a statement of cost of services sold. Mason, Durant, and Westbrook Statement of Cost of Services Sold For the Year Ended June 30 Direct materials used Direct labor Overhead Total service costs added Add: Beginning work in proces Less Ending work in process Cost of services sold 2. Refer to the statement prepared in Requirement 1. What is the dominant cost? Direct labor Will this always be true of service organizations? The station above might be the case because: 3. Assuming that the average fee for processing a return is $860, prepare an income statement for Mason, Durant, and Westbrook. Mason, Durant, and Westbrook Income Statement For the Year Ended June 30 Sales Cost of services sold Gross margin Less operating expenses Selling expenses Administrative expenses Operating Income 4. How does the amount of total units factor into the calculation of average cost? per return How do the differences between services and tangible products affect the ability of How to use the last year's average cost of preparing tax return in Budgeting the cost of tax return services to be offered next year? All of the above might affect the