cr dr 840,000.00 840,000.00 1 pt. 300,000.00 200,000.00 100,000.00 1 pt. 60,000.00 40,000.00 80,000.00 20,000.00 1 pt. 180,000.00 120,000.00 300,000.00 1 pt. 600,000.00 600,000.00 1 pt. Journal Entries 1 Purchases A/P 2 Direct Labor Cash Accrued Wages Payable 3 Factory Heat, Light and Power Utilities Expense Cash Accrued Utilities Payable 4 Indirect Labor Salaries Expense Cash 5 A/P Cash 6 A/P Purchase Returns 7A/P Purchase Discounts 8 Freight-in Cash 9 Depreciation (Factory) Depreciation Expense Accumulated Depreciation 10 Other Mfg. Overhead Cash 11 A/R Sales Bad Debt Expense Allowance for Doubful Accts. 90,000.00 90,000.00 1 pt. 16,800.00 16,800.00 1 pt. 20,000.00 20,000.00 1 pt. 20,000.00 10,000.00 30,000.00 1 pt. 140,000.00 140,000.00 1 pt. 4,000,000.00 4,000,000.00 80,000.00 1 pt. 80,000.00 6,516,800.00 6,516,800.00 953,200.00 (233,200.00) 720,000.00 300,000.00 YouTech Corporation Cost of Goods Manufactured and Sold Statement For the year ended August 31, 2007 RM Costs: RM, beg. 200,000.00 (+) Purchases 840,000.00 Freight-in 20,000.00 Purchase Returns (90,000.00) Purchase Discounts (16,800.00) Total Purchases 753,200.00 RM Available for use (-) RM, end. Cost of Materials Used Direct Labor Factory Overhead Costs Factory Heat, Light and Power 60,000.00 Depreciation (factory) 20,000.00 Indirect Labor 180,000.00 Other Mfg. Overhead 140,000.00 Total FOH Costs Total Manufacturing Costs (+) WIP, Beg. (-) WIP, End. Cost of Goods Manufactured (+) FG, Beg. Cost of Goods Available for Sale (-) FG, End. Cost of Goods Sold 400,000.00 1,420,000.00 340,000.00 (485,000.00) 1,275,000.00 280,000.00 1,555,000.00 (170,000.00) 1,385,000.00 Sales increase 25% Purchases Increase 35% Direct Labor Increase 10% Total FOH increase 35% What will happen to Gross Margin after these changes on 2007? What is the GM % and how does this compare to the original GM% for 2007