Current Attempt in Progress Sunland Company is a manufacturer of computers. Its controller resigned in October 2022. An inexperienced assistant accountant has prepared the following income statement for the month of October 2022. SUNLANDCOMPANY Income Statement For the Month Ended October 31, 2022 Sales (net) $783,100 Less: Operating expenses Raw materials purchases $264,300 Direct labour cost 190,500 Advertising expense 89,100 Selling and administrative salaries 74,450 Rent on factory facilities 60,550 Depreciation on sales equipment 44,550 Depreciation on factory equipment 31,900 Indirect labour cost 28,150 Utilities expense 12,800 Insurance expense 8,250 804,550 Net Loss $(21,450) Prior to October 2022, the company had been profitable every month. The company's president is concerned about the accuracy of the income statement. As his friend, he has asked you to review the income statement and make necessary corrections. After examining other manufacturing cost data, you have acquired the following additional information. 1. Inventory balances at the beginning and end of October were as follows: October 1 October 31 Raw materials $18,000 $29,750 Work in process 16,000 15,000 Finished goods 30,100 45,250 2. Only 80% of the utilities expense and 54% of the insurance expense apply to factory operations. The remaining amounts should be charged to selling and administrative activities.