Financial Statements of a Manufacturing Firm

The following events took place for Rushmore Biking Inc. during February, the first month of operations as a producer of road bikes:

Purchased $$194,300$ of materials.

Used $$167,100$ of direct materials in production.

Incurred $$144,000$ of direct labor wages.

Applied factory overhead at a rate of $70\%$ of direct labor cost.

Transferred $$395,400$ of work in process to finished goods.

Sold goods with a cost of $$388,600.$

Revenues earned by selling bikes, $$695,600.$

Incurred $$167,100$ of selling expenses.

Incurred $$62,200$ of administrative expenses.

a$.$ Prepare the income statement for Rushmore Biking Inc. for the month ending February $28.$ Assume that Rushmore Biking Inc. uses the perpetual inventory method.

Rushmore Biking Inc.

Income Statement

For the Month Ended February $28$

Selling and administrative expenses:

$4$

Total selling and administrative expenses

b$.$ Determine the inventory balances on February $28,$ the end of the first month of operations.

Materials inventory, February $28$

Work in process inventory, February $28$

$

Finished goods inventory, February $28$

$

$