Empire Company is a manufacturer of smart phones. Its controller resigned in October 2020. An inexperienced assistant accountant has prepared the following income statement for the month of October 2020.

EMPIRE COMPANY Income Statement For the Month Ended October 31, 2020
Sales revenue					$795,000
Less:	Operating expenses
	Raw materials purchases		$264,600
	Direct labor cost		190,200
	Advertising expense		91,000
	Selling and administrative salaries		77,800
	Rent on factory facilities		61,000
	Depreciation on sales equipment		45,800
	Depreciation on factory equipment		32,500
	Indirect labor cost		28,200
	Utilities expense		11,600
	Insurance expense		8,300		811,000
Net loss					$(16,000)

Prior to October 2020, the company had been profitable every month. The companys president is concerned about the accuracy of the income statement. As her friend, you have been asked to review the income statement and make necessary corrections. After examining other manufacturing cost data, you have acquired additional information as follows.

1. Inventory balances at the beginning and end of October were:

		October 1		October 31
Raw materials		$19,700		$36,000
Work in process		19,400		14,700
Finished goods		29,900		53,500

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.

Empire Company manner of mart phone bateria in Detaber 2012. Air periodi s untarthat prepared the following income statement for the month a Income Statement fer the Month Ende Ortaha 1, 2020 Lawr: Operation Direct laborest 77800 61,000 Runtoneryfacit Duronensis Deprecationen octory oument Insurance repen 8.300 81100 $15.000) Prior to October 2020, the company has wo n the court's president is com about rections. Allereising the manufacturing best you have acred Rional informations follows 1. Ivorybolances at the beginning and end of October were Raw materials Work in process Finished October 1 October 31 $19.700 $36,000 19.400 14700 29,900 2,500 2 Only 75 of the its operise and of the interey to cooper . Therung mit should be charged to wing and administrative activities Preparachukulcstaf soda muntactured for October 2000 EMPERE COMPANY Cost of Goods Manufactured Schedule LLE