Question 4 Empire 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. $793,600 EMPIRE COMPANY Income Statement For the Month Ended October 31, 2020 Sales revenue Less: Operating expenses Raw materials purchases $264,900 Direct labor cost 191,600 Advertising expense 92,900 Selling and administrative salaries 77,500 Rent on factory facilities 61,400 Depreciation on sales equipment 44,200 Depreciation on factory equipment 32,400 Indirect labor cost 29,600 Utilities expense 11,200 Insurance expense 8,200 Net loss 813,900 $(20,300) Prior to October 2020, the company had been profitable every month. The company's 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 31 Raw materials Work in process Finished goods October 1 $19,800 19,300 31,000 $35,900 14,500 53,300 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. Prepare a schedule of cost of goods manufactured for October 2020. EMPIRE COMPANY Cost of Goods Manufactured Schedule . Attempts: 0 of 1 used