Ehrlich Company had the following inventory balances at the beginning and end of the year:

	January 1	December 31
Raw material	$60,000	$50,000
Work in process	140,000	180,000
Finished goods	280,000	255,000

During the year, the company purchased $110,000 of raw material and incurred $350,000 of direct labor costs.

Other data: manufacturing overhead incurred, $450,000; manufacturing overhead applied, $460,000

Sales, $1,600,000;

Selling and administrative expenses, $97,000;

Income tax rate, 30%.

Required: A. Prepare a schedule of cost of goods manufactured. B. Prepare a schedule of goods sold. C. Prepare an income statement.