Financial Statements of a Manufacturing Firm The following events took place for Digital Vibe Manufacturing Company during March, the first month of its operations as a producer of digital video monitors: Purchased $70,000 of materials. Used $53,900 of direct materials in production. Incurred $80,500 of direct labor wages. Incurred $113,400 of factory overhead. Transferred $188,300 of work in process to finished goods. Sold goods for $336,700. Sold goods with a cost of $149,800. Incurred $86,100 of selling expense. Incurred $37,800 of administrative expense.

Using the information given, complete the following: a. Prepare the March income statement for Digital Vibe Manufacturing Company.

b. Determine the inventory balances at the end of the first month of operations.

Digital Vibe Manufacturing Company
Inventory Balances
For the Month Ended March 31
Inventory balances on March 31:
Materials
Work in process
Finished goods