Delivery driver wages No Yes NO . No No Yes No No No No No Depreciation of office corputers No Yes NO NO . No . No . Yes No No No NO Power to run the cheesecake ovens Yes . No No - No Yes No - No No Yes No Yes President's salary No - Yes - No No - No No Yes No No No No Sales commissions No - Yes . No No No - Yes No No . No . No No Factory supervisor salary Yes - No - No No Yes - NO . No No Yes . No Yes Feedback Check My Work Review the definitions of each type of cost. Note that each cost may be in more than one category. Financial Statements Charles lound some sample income statements and balance sheets on the Internet, and asked which of them might be most appropriate for a manulacturing business like his. Review income statements A and B, and balance sheets C and D. Determine which income statement and balance sheet would be most appropriate for a manufacturing business like Able Baker Charlie Company Income Statement A $42,000 Sample Company A Income Statement For the Year Ended December 31, 2018 Sales Finished goods inventory, January 1, 20Y8 $5,250 Cost of goods manufactured 6,400 Cost of finished goods available for sale $11,650 Finished goods inventory, December 31, 20Y8 (400) Cast of goods sold Gross profit Operating expenses: Selling expenses $6,400 (11,250) $30,750 Administrative expenses 5,250 Total operating experts (11,650) Net Income $ $19,100 Administrative expenses 5,250 Total operating expenses (11,650) Net income $19,100 Income Statement B Sample Company B Income Statement For the Year Ended December 31, 2048 Sales $42,000 Beginning inventory $5,250 Net purchases 6,400 Inventory available for sale $11,650 Ending inventory (400) Cost of goods sold (11,250) Gross profit $30,750 Operating expenses: Selling expenses $6,400 Administrative expenses 5,250 Total operating expenses (11,650) Net income $19,100 Balance Sheet C Sample Company C Balance Sheet December 31, 20Y8 Assets Cash $20,800 Accounts receivable (net) 10,000 Inventory 6,000 Supplies 2,100 Land 17,000 Total assets $55,900 Liabilities Land 17,000 Total assets $55,900 Liabilities Accounts payable $17,800 Stockholders' Equity Common stock $19,000 Retained earnings 19,100 Total stockholders' equity 38,100 Total liabilities and stockholders' equity $55,900 Balance Sheet D Sample Company D Balance Sheet December 31, 2018 Assets Cash $20,800 Accounts receivable (net) 10,000 Inventory: Direct materials $2,500 Work in process 1,500 Finished goods 2,000 Total inventory 6,000 Supplies 2,100 Land 17,000 Total assets $55,900 Liabilities Accounts payable $17,800 Stockholders' Equity Common stock $19,000 Retained earnings 19,100 Total stockholders' equity 38,100 38.100 Total stockholders' equity Tatal liabilities and stackholders' equity $55,000 Which income salmer is most appropriale for a manufacturing business? Income statement A which balance sheet is most appropriate for a manufacturing business? Balance sheet D D FK Check My Work Think about which accounts would be needed in a manutachung environment Costs and Balances At the end of February, after the second month of operations of Able Baker Charlie Company, Charles shows you the data he's collected, but he was unable to figure out some of the amounts. Review the following data and fill in the missing amounts on the chart for Able Baker Charlie Company. Note: It may be helpful to use l accounts to map the flow of the amounts through the manufacturing accounts and solve for the missing dollar values. It may also be helpful to review the steps for determining the cost of materials used, total manufacturing most incurred, and most of goods manufacturext. Data for February $3,600 50% of malerials invenilory on Jan. 31 $11,700 Decrease in materials Inventory Malerials invenlety car Feb. 28 Direct materials purchased Direct materials used Tulal manufacturing costs incurred in period Total manufacturing costs incurred in period Total manufacturing costs Incurred in period 3 times the direct labor incurred $29,400 70% of Cost of Goods Manufactured $7,000 less than Cost of Goods sold Account Balances Account Jan. 31 Feb. 28 Costs Incurred Materials Inventory Direct Materials Used Work in Prox Triventory 27,000 Direct Labur Incurred x Finished Goods Inventory 16,000 Factory Overhead incurred Costs and Balances At the end of February, after the second month of operations of Able Baker Charlie Company, Charles shows you the data he's collected, but he was unable to figure out some of the amounts. Review the following data and fill in the missing amounts on the chart for Able Baker Charlie Company. Note: It may be helpful to use T accounts to map the flow of the amounts through the manufacturing accounts and solve for the missing dollar values. It may also be helpful to review the steps for determining the cost of materials used, total manufacturing cost incurred, and cost of goods manufactured. Data for February Decrease in materials inventory $3,600 Materials inventory on Feb. 28 50% of materials inventory on Jan. 31 Direct materials purchased $11,700 Direct materials used 3 times the direct labor incurred Total manufacturing costs incurred in period $29,400 Total manufacturing costs incurred in period 70% of Cost of Goods Manufactured Total manufacturing costs incurred in period $7,000 less than Cost of Goods Sold Account Balances Account Jan. 31 Feb. 28 Costs Incurred Materials Inventory Direct Materials Used Work in Process Inventory 27,000 Direct Labor Incurred Mjde Finished Goods Inventory 16,000 Factory Overhead Incurred Cost of Goods Sold