Oriole Company is a manufacturer of smart phones. Its controller resigned in October 2020. An inexperienced assistant accountant has prepared the following income statement for the month of October 2020.

ORIOLE COMPANY Income Statement For the Month Ended October 31, 2020
Sales revenue					$794,000
Less:	Operating expenses
	Raw materials purchases		$263,700
	Direct labor cost		192,000
	Advertising expense		92,600
	Selling and administrative salaries		77,200
	Rent on factory facilities		62,500
	Depreciation on sales equipment		45,600
	Depreciation on factory equipment		32,800
	Indirect labor cost		28,400
	Utilities expense		12,800
	Insurance expense		8,800		816,400
Net loss					$(22,400)

Prior to October 2020, the company had been profitable every month. The companys president is concerned about the accuracy of the income statement. As her friend, you have been asked to review the income statement and make necessary corrections. After examining other manufacturing cost data, you have acquired additional information as follows. 1. Inventory balances at the beginning and end of October were:

		October 1		October 31
Raw materials		$20,600		$35,100
Work in process		19,700		14,900
Finished goods		30,900		53,400

2. Only 75% of the utilities expense and 60% of the insurance expense apply to factory operations. The remaining amounts should be charged to selling and administrative activities.

A) Prepare a schedule of cost of goods manufactured for October 2020.

B) Prepare a correct income statement for October 2020.

Prepare a correct income statement for October 2020 ORIOLE COMPANY Income Statement