Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials):

Selling expenses $140,000

Purchases of raw materials $290,000

Direct labor ?

Administrative expenses $100,000

Manufacturing overhead applied to work in process $285,000

Actual manufacturing overhead cost $270,000

Inventory balances at the beginning and end of the year were as follows:

BEGINNING OF YEAR END OF YEAR

Raw Materials $40,000 $10,000

Work in process ? $35,000

Finished goods. $50,000 ?

The total manufacturing costs for the year were $683,000, the cost of goods available for sale totaled $740,000, the unadjusted cost of goods sold totaled $660,000, and the net operating income was $30,000. The company's underapplied or over applied overhead is closed to Cost of Goods Sold.

REQUIRED:

PREPARE SCHEDULES OF COST OF GOODS MANUFACTURED And COST OF GOODS SOLD AND AN INCOME STATEMENT. (Hint: Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.