Classic Cabinets has a factory that produces custom kitchen cabinets. It has multiple product lines.

Materials and labor for the cabinets are determined by each job. To simplify the assignment, we will assume the following average costs.

The following information highlights Classic Cabinet's cost structure for 2020.

The materials include $5,000 for materials on a per-job basis.

It requires 35 hours of labor on average for the cabinetry. The hourly rate is $15.

The sales price will be set at a markup of 85%.

The company estimates that it will have 70,000 direct labor hours in total for the cabinets.

It assumes 2,000 units are sold on average per year. A breakdown of estimated yearly costs related to the cabinetry follows:

Salaries- Sales force $ 594,000

Salaries for factory laborers $ 390,500

Office Rent $ 159,500

Factory Rent $ 35,200

Office utilities and Misc office expenses(based on units sold) $ 17,600

Sales travel(based on units sold) $ 25,300

Insurance - office $ 15,400

Depreciation - office equipment $ 45,100

Depreciation for factory equipment $ 79,200

Advertising $ 38,500

Sales commissions(based on units sold) $ 59,400

Factory Property taxes $ 28,600

Maintenance for factory equipment $ 93,500

Prepare a traditional Income Statement assuming a volume of 2,000 units. For the cost of goods sold, please use the per unit cost you calculated in #2. You do not have to prepare any additional schedules. I would use a similar format to exhibit 16-8 on page 737 or from your lecture notes. I recommend that you list out all operating expenses (period costs) identified in Q1. Do not use just Selling and General/Administrative Expenses for your categories. Points will be lost by not listing out all period costs. You can ignore interest and income tax expense. These numbers should be linked to Q1