Problem 2-44A

Tombert Company is a manufacturer of computers. Its controller resigned in October 2016. An inexperienced assistant accountant has prepared the following income statement for the month of October 2016.

TOMBERT COMPANY Income Statement For the Month Ended October 31, 2016
Sales (net)				$ 782,700
Less: Operating expenses
Raw materials purchases		$264,550
Direct labour cost		190,800
Advertising expense		89,900
Selling and administrative salaries		74,950
Rent on factory facilities		60,600
Depreciation on sales equipment		44,850
Depreciation on factory equipment		31,700
Indirect labour cost		28,450
Utilities expense		12,800
Insurance expense		8,750		807,350
Net Loss				$(24,650)

Prior to October 2016, the company had been profitable every month. The companys president is concerned about the accuracy of the income statement. As his friend, he has asked you to review the income statement and make necessary corrections. After examining other manufacturing cost data, you have acquired the following additional information. 1. Inventory balances at the beginning and end of October were as follows:

		October 1		October 31
Raw materials		$15,800		$29,650
Work in process		16,350		14,800
Finished goods		30,500		45,950

2. Only 73% of the utilities expense and 53% of the insurance expense apply to factory operations. The remaining amounts should be charged to selling and administrative activities. Calculate the following:

Question follows: Please fill in the blanks

Prepare a correct income statement for October 2016. (Round answers to 0 decimal places, e.g. 125. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

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Prepare a schedule of the cost of goods manufactured for October 2016. (Round answers to 0 decimal places, e.g. 125.) TOMBERT COMPANY Cost of Goods Manufactured Schedule For the Month Ended October 31, 2016 TOMBERT COMPANY Income Statement For the Month Ended October 31, 2016