Income Statement. Cost of Service Provided. Service Atributes Mason, Durant and Westbrook (MOW) is a tax c m . The firm is located in shoma City and employs 15 professionals and eight statt Thermostax work for small businesses and well-to-do individuals The following data are provided for the s cal year (The Mason, Durant and Westbrookcal year runs from July 1 through ane 30.) Rere processed 3.000 Returns in process, beginning of year $4,000 Returns in process, end of year 14.000 Cost of sold 1.581,000 Beginning direct materials inventory 20.000 Purchases, direct materials 40.000 Direct labor 1,400,000 Othead - 100.000 Seling expenses 65,000 Required: 1. Prepare a statement of cost of services sold M Durant and West Satment of Co rvices Sold For the Year Ended me 30 Previous Next 1. Prepare a statement of cost of services sold. Mason, Durant, and Westbrook Statement of Cost of Services Sold For the Year Ended June 30 Direct materials used Direct labor 1,400,000 Overhead 100,000 Total service costs added Add: Beginning work in process 43,000 Less: Ending work in process 14,000 Cost of services sold Feedback 7 Check My Work A service firm doesn't have finished goods inventories since services can't be stored, although it is possible to have 2. Refer to the statement prepared in Requirement 1. What is the dominant cost? Direct labor Will this always be true of service organizations? Check My Work All work saved. archD ea 3. Assuming that the average fee for processing a retum is $870, prepare an income statement for Mason, Durant, and Westbrook. Mason, Durant, and Westbrook Income Statement For the Year Ended June 30 Sales Cost of services sold Gross margin Less operating expenses: Selling expenses Administrative expenses Operating Income Feedback 7 Check My Work See Cornerstone 2.4 4. How does the amount of total units factor into the calculation of average cost? per return