Problem 10-27A (Algo) Schedule of cost of goods manufactured and sold LO 10-3 Antioch Company makes eBook readers. The company had the following amounts at the beginning of Year 2: Cash, $674,000; Raw Materials Inventory, $60,000; Work in Process Inventory, $35,000; Finished Goods Inventory, $63,000; Common Stock, $600,000; and Retained Earnings, $232,000. Antioch experienced the following accounting events during Year 2. Other than the adjusting entries for depreciation, assume that all transactions are cash transactions. 1. Paid $27,000 of research and development costs. 2. Paid $63,000 for raw materials that will be used to make eBook readers. 3. Placed $86,000 of the raw materials cost into the process of manufacturing eBook readers. 4. Paid $67,000 for salaries of selling and administrative employees. 5. Paid $106,000 for wages of production workers. 6. Paid $179,000 to purchase equipment used in selling and administrative offices. 7. Recognized depreciation on the office equipment. The equipment was acquired on January 1, Year 2. It has a $19,000 salvage value and a eight-year life. The amount of depreciation is computed as [(Cost - salvage) + useful life]. Specifically, ($179,000 - $19,000) = 8 = $20,000. 8. Paid $159,000 to purchase manufacturing equipment 9. Recognized depreciation on the manufacturing equipment. The equipment was acquired on January 1, Year 2. It has a $26,000 salvage value and a seven-year life. The amount of depreciation is computed as [(Cost - salvage) = useful life). Specifically, ($159,000 - $26,000) = 7 = $19,000. 10. Paid $51,000 for rent and utility costs on the manufacturing facility. 11. Paid $79,000 for inventory holding expenses for completed eBook readers (rental of warehouse space, salaries of warehouse personnel, and other general storage cost). 12. Completed and transferred eBook readers that had total cost of $247,000 from work in process inventory to finished goods. 13. Sold 920 eBook readers for $433,000. 14. It cost Antioch $184,000 to make the eBook readers sold in Event 13. Required: a. Show how these events affect the balance sheet, income statement, and statement of cash flows by recording them in a horizontal financial statements model. C-1. Prepare a schedule of cost of goods manufactured and sold for the year. c-2. Prepare a formal income statement for the year. c-3. Prepare a balance sheet for the year. Complete this question by entering your answer in the tabs below. ANTIOCH COMPANY Schedule of Cost of Goods Manufactured and Sold For the Year Ended December 31, Year 2 Beginning raw materials $ 60,000 Inventory Purchases 63,000 Raw materials available 123,000 Ending raw materials (37,000 inventory Raw materials used 86,000 Labor 106,000 Overhead 70,000 Total manufacturing 262,000 costs Beginning work in 35,000 process inventory Total work in process 297,000 inventory Ending work in process (51,000 X inventory Cost of goods 246,000 manufactured Beginning finished goods 63,000 inventory Goods available 309,000 Ending finished goods 333,000 inventory $ Cost of goods sold 642,000 ANTIOCH COMPANY Income Statement For the Year Ended December 31, Year 2 $ Sales revenue 433,000 Cost of goods sold 184,000 Gross margin 249,000 Selling and administrative 60,000 X expense 37,000x Net income 41,000x SK ANTIOCH COMPANY Income Statement For the Year Ended December 31, Year 2 $ Sales revenue 433,000 Cost of goods sold 184,000 Gross margin 249,000 Selling and administrative 60,000 expense 37,000x Net income 41,000x OS