Sheridan 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 SHERIDAN COMPANY Income Statement For the Month Ended October 31, 2020 Sales revenue $793,400 Less: Operating expenses Raw materials purchases Direct labor cost Advertising expense Selling and administrative salaries Rent on factory facilities Depreciation on sales equipment Depreciation on factory equipment Indirect labor cost Utilities expense Insurance expense $263,700 189,400 92,700 77,400 62,700 44,100 32,500 28,400 12,200 8,700 811,800 Net loss $(18,400) 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 1 October 31 Raw materials Work in process Finished goods $20,900 19,100 31,000 $36,000 14,700 53,500 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 Income Statement 19100 20900 263700 284600 36000 248600 189400 62700 32500 28400 9150 5220 137970 580370