Q2. The following data refer to Nani's Fashions for the current year:

Sales Revenues

$475 000

Work in process inventory, 31 December

15 000

Work in process inventory, 1 January

20 000

Selling and administrative expenses

75 000

Income tax expense

45 000

Purchase of raw materials

90 000

Raw materials inventory, 31 December

12 500

Raw material inventory. 1 January

20 000

Direct labour

100 000

Electricity: plant

20 000

Depreciation plant and equipment

30 000

Finished goods inventory, 31 December

25 000

Finished goods inventory, 1 January

10 000

Indirect material

5 000

Indirect labour

7 500

Other manufacturing overhead

40 000

Required:

a) Prepare the schedule of cost of goods manufactured for Nani's fashion.

b) Prepare the schedule of cost of goods sold for Nani's Fashions and explain the information provided by the schedule of cost of goods sold.

c) Prepare an income statement for the current year.