Flow of Costs and Income Statement Technology Accessories Inc is a designes manufactures, and distributor of accessories for consumer electronic products. Early in 2013, the company began production of a leather cover for tablet computers, called the Leather. The cover made atched leather with a velvet interior and Sts snugly around mest tablet computers. In January; $750,000 was spent on developing marketing and advertising materials. For the first six months of 2013, the company spent an additional $1.400.000 pruting the leather. The product was ready for manufacture on January 21, 2013. Technology Accesories inc uses a job ander system to accumulate costs for the Leather, Direct materials unit costs for the Leather are as follows: Leather Velvet Packaging Total $10.00 5.00 0.40 $15.40 The actual production process for the sather is fairly straightforward. First, leather is brought to a cutting and stitching machine. The machine cuts the leather and stitches an exterior edge into the product. The machine requires one hour per 125 Leathers After the Leather is it and stitched, it is brought to assembly, where assembly personnel affix the velvet interier and pack the Leather for shipping. The direct labor cost for this work is $0.50 per un The completed packages and then sold to retail outlets through a sales force. The sales force is compensated by a 20% commission on the wholesale price for all sales Total completed production was 500,000 units during the year. Other information is as follows Number of Leather units sold in 2013 460,000 Wholesale price 140 Factory verhead cost is applied to jobs at the rate of $1,250 per machine hour. There were an additional 22,000 cut and stitched Leathers waiting to be assembled on December 31, 2013. In your computations, if required, round interim per unit costs to two decimal places. Required In your computations, if required, round interim per unit costs to two decimal places. Required: 1. Prepare an annual income statement for the iLeather product. Technology Accessories Inc. Income Statement For the Year Ended December 31, 20Y3 Selling Expenses: Total Selling Expenses LT 2. Determine the balances in the finished goods and work in process inventories for the iLeather product on December 31, 2013. Finished Goods Work in Process