Statement of Cost of Goods Manufactured and Income Statement for a Manufacturing Company The following information is available for Deutsch Corporation for 2016: Inventories January 1 December 31 Materials $385,660 $478,220 Work in process 694,190 650,380 Finished goods 667,190 664,730 Advertising expense $324,710 Depreciation expense-office equipment 45,910 Depreciation expense-factory equipment 61,690 Direct labor 736,460 Heat, light, and power-factory 24,390 Indirect labor 86,080 Materials purchased 722,110 Office salaries expense 252,020 Property taxes-factory 20,090 Property taxes-office building 41,610 Rent expense-factory 33,950 Sales 3,381,020 Sales salaries expense 415,090 Supplies-factory 16,740 Miscellaneous costs-factory 10,520 Required: 1. Prepare the 2016 statement of cost of goods manufactured. Deutsch Corporation Statement of Cost of Goods Manufactured For the Year Ended December 31, 2016 Work in process inventory, January 1, 2016 $ 694,190 Direct materials: Materials inventory, January 1, 2016 $ 385,660 Purchases Cost of materials available for use $ Less materials inventory, December 31, 2016 478,220 Cost of direct materials used in production $ Direct labor 736,460 Factory overhead: Indirect labor $ 86,080 Depreciation expense-factory equipment 61,690 Heat, light, and power-factory 24,390 Property taxes-factory 20,090 Rent expense-factory 33,950 Supplies-factory 16,740 Miscellaneous costs-factory 10,520 Total factory overhead Total manufacturing costs incurred during the year Total manufacturing costs $ Less work in process inventory, December 31, 2016 Cost of goods manufactured $ Feedback 1. The cost of goods manufactured is the beginning work in process plus the cost of direct materials used in production plus direct labor and factory overhead, less the ending work in process. Learning Objective 2, Learning Objective 3. 2. Prepare the 2016 income statement. Deutsch Corporation Income Statement For the Year Ended December 31, 2016 Sales $ Cost of good sold: Finished goods inventory, January 1, 2016 $ Cost of goods manufactured Cost of finished goods available for sale $ Less finished goods inventory, December 31, 2016 Cost of goods sold Gross profit $ Operating expenses: Administrative expenses: Office salaries expense $ Depreciation expense-office equipment Property taxes-office building $ Selling expenses: Advertising expense $ Sales salaries expense Total operating expenses Net income $