EMPIRE COMPANY For the Month Ended October 31, 2017 $793,600 Sales revenue Less: Operating expenses Raw materials purchases Direct lebor cost Advertising expense Selling and adminitrative laries Rent on factory facil ties Depreciation on zales equipment Depreciation on factory equipment Indiract labor cost Utilities expense Insurance expense $264.900 191,600 92,900 77,500 44,200 29,600 11,200 8,200813,9 00 813,900 (20,300 Prior to October 2017, the company had been profitable every month. The company's president Is concerned about the accuracy of the Income statement. As her friend, you have been asked to revlew the income statement and make necessary corrections. After examining other manufacturing cost data, you have acquired add tional information as follows 1. Inventory balances at the beginning and end of October were: October October 31 Raw materials Work in process Finished goods $19,800 19,300 31,000 435,900 14,500 53,300 2. Only 75% of the utilities expense and 60% of the insurance expense apply to factory operations. The remaining amounts should be charged to selling and administrative activities