Question
Financial statements of a manufacturing firm The following events took place for Sorensen Manufacturing Company during January, the first month of its operations as a
Financial statements of a manufacturing firm
The following events took place for Sorensen Manufacturing Company during January, the first month of its operations as a producer of digital video monitors:
- Purchased $275,000 of materials.
- Used $198,000 of direct materials in production.
- Incurred $495,000 of direct labor wages.
- Incurred $198,000 of factory overhead.
- Transferred $836,000 of work in process to finished goods.
- Sold goods for $1,320,000.
- Sold goods with a cost of $742,500.
- Incurred $236,500 of selling expense.
- Incurred $137,500 of administrative expense.
Using the information given, complete the following:
Prepare the January income statement for Sorensen Manufacturing Company. Round your answers to the nearest dollar.
Sorensen Manufacturing Company | ||
Income Statement | ||
For the Month Ended January 31 | ||
Administrative expensesGross profitRevenuesSelling expensesRevenues | $fill in the blank 3 | |
Administrative expensesCost of goods soldFinished goodsWork in processCost of goods sold | fill in the blank 5 | |
Administrative expensesGross profitNet incomeSelling expensesGross profit | $fill in the blank 7 | |
Operating expenses: | ||
Cost of goods soldMaterialsRevenuesSelling expensesSelling expenses | $fill in the blank 9 | |
Administrative expensesCost of goods soldGross profitWork in processAdministrative expenses | fill in the blank 11 | |
Total operating expenses | fill in the blank 12 | |
Net incomeNet lossNet income | $fill in the blank 14 |
Determine the inventory balances at the end of the first month of operations. Round your answers to the nearest dollar.
Sorensen Manufacturing Company | |
Inventory Balances | |
For the Month Ended January 31 | |
Inventory balances on January 31: | |
Materials | $fill in the blank 15 |
Work in process | $fill in the blank 16 |
Finished goods | $fill in the blank 17 |
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