Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies for the month of December: On Off Company Company Materials inventory, December 1 $62,030 $84,360 Materials inventory, December 31 (a) 95,330 Materials purchased 157,560 (a) Cost of direct materials used in production 166,240 (b) Direct labor 233,850 189,810 Factory overhead 72,580 94,480 Total manufacturing costs incurred in December (b) 545,810 Total manufacturing costs 591,770 591,770 Work in process inventory, December 1 119,100 203,310 Work in process inventory, December 31 100,490 (c) Cost of goods manufactured (c) 540,750 Finished goods inventory, December 1 104,830 94,480 Finished goods inventory, December 31 109,790 Sales 914,320 (d) 843,600 Cost of goods sold (d) 545,810 Gross profit (e) (e) Operating expenses Net income Required. 119,100 (f) 187,280 (f) 1. Determine the amounts of the missing items, identifying them by letter. Enter all amounts as positive numbers. Letter a. b. C. d. On Company e. $ $ Feedback Off Company Check My Work 1. a. The cost of direct materials used in production includes the beginning materials inventory plus purchases, less the ending materials inventory. b. Total manufacturing costs incurred during December include direct materials, direct labor, and factory overhead. c. The cost of goods manufactured is beginning work in process plus total manufacturing costs less the ending work in process. d. The cost of goods sold is the beginning finished goods plus the cost of goods manufactured, less the ending finished goods. e. Sales minus cost of goods sold equals gross profit. f. Gross profit minus operating expenses equals net income. Use similar relationships from On Company to find the missing amounts for the Off Company items (a) through (f). 2. Prepare On Company's statement of cost of goods manufactured for December. On Company Statement of Cost of Goods Manufactured For the Month Ended December 31 Work in process inventory, December 1 Direct materials: Materials inventory, December 1 Purchases 62,030 157,560 Cost of materials available for use Materials inventory, December 31 Cost of direct materials used in production Direct labor Factory overhead Total manufacturing costs incurred during December Total manufacturing costs Work in process inventory, December 31 Cost of goods manufactured 219,590 119,100 53,350 166,240 233,850 72,580 472,670 591,770 100,490 491,280 3. Prepare On Company's income statement for December. On Company Income Statement For the Month Ended December 31 Sales Cost of goods sold: Finished goods inventory, December 1 Cost of goods manufactured Cost of finished goods available for sale Finished goods inventory, December 31 Cost of goods sold Gross profit Operating expenses Net income Feedback Check My Work 3. Sales minus cost of goods sold equals gross profit. Cost of goods sold is equal to beginning Finished Goods plus Cost of Goods Manufactured less ending Finished Goods. Gross profit minus operating expenses equals net income