Santana Rey, owner of Business Solutions, decides to diversify her business by also manufacturing computer workstation furniture.

Required:

1.	Classify the following manufacturing costs of Business Solutions as (a) variable or fixed and (b) direct or indirect.

2.	Prepare a schedule of cost of goods manufactured for the month ended January 31, 2016.
	Direct materials: $2,200
	Factory overhead: $460
	Direct labor: $1,000
	Beginning work in process: none (December 31, 2015)
	Ending work in process: $580 (January 31, 2016)
	Beginning finished goods inventory: none (December 31, 2015)
	Ending finished goods inventory: $350 (January 31, 2016)

3.	Prepare the cost of goods sold section of the income statement for Business Solutions for the month ended January 31, 2016.