Please the ending inventory has to be found to calculate Direct Materials Used. Explain how I find the ending inventory and Direct Materials Used step by step

Income Statement, Cost of Services Provided, Service Attributes 2-17 LO 2, L03 Young, Coopers, and Touche (YCT) is a tax services firm. The firm is located in San Diego and employs 10 professionals and eight staff. The firm does tax work for small businesses and well-to-do individuals. The following data are provided for the last fiscal year. (YCT's fiscal year runs from July 1 through June 30.) Chapter 2 Basic Cost Management Concepts 49 Returns processed Returns in process, beginning of year Returns in process, end of year Cost of services sold Beginning direct materials inventory Purchases, direct materials Direct labor Overhead Administrative Selling 2,000 $ 78,000 134,000 890,000 20,000 40,000 800,000 100,000 69,000 53,000 Required: 1. Prepare a statement of cost of services sold. 2. Refer to the statement prepared in Requirement 1. What is the dominant cost? Will this always be true of service organizations? If not, provide an example of an exception. 3. Assuming that the average fee for processing a tax return is $650, prepare an income statement for YCT. 4. Discuss three differences between services and tangible products. Calculate the average cost of preparing a tax return for last year. How do the differences between services and tangible products affect the ability of YCT to use the last year's aver- age cost of preparing a tax return in budgeting the cost of tax return services to be offered next year