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 $$261,000$ of materials.

Used $$187,920$ of direct materials in production.

Incurred $$469,800$ of direct labor wages.

Incurred $$187,900$ of factory overhead.

Transferred $$793,400$ of work in process to finished goods.

Sold goods for $$1,252,800.$

Sold goods with a cost of $$704,700.$

Incurred $$224,500$ of selling expense.

Incurred $$130,500$ of administrative expense.

This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below.

Open spreadsheet

Using the information given, complete the following:

a$.$ Prepare the January income statement for Sorensen Manufacturing Company.

Sorensen Manufacturing Company

Income Statement

For the Month Ended January $31$

Line Item Description Amount Amount

Revenues $$1,252,800$

Cost of goods sold $704,700$

Gross profit $$548,100$

Operating expenses:

Selling expenses $$224,500$

Administrative expenses $130,500$

Total operating expenses $355,000$

Net income

$$193,100$

$2.$ Determine the inventory balances at the end of the first month of operations.

Sorensen Manufacturing Company

Inventory Balances

For the Month Ended January $31$

Line Item Description Amount

Inventory balances on January $31$:

Materials $fill in the blank $15$

Work in process $fill in the blank $16$

Finished goodsFinished goods $fill in the blank $17$