Swift Company was organized on March 1 of the current year. After five months of startup losses management had expected to earn a profit during August, the most recent month. Management was disappointed, however, when the income statement for August also showed a loss. August's income statement follows: Income Statement $495,000 Sales Less: Operating expenses Indirect labour cost Utilities Direct labour cost Depreciation, factory equipment Raw materials purchased Depreciation, sales equipment Insurance Rent on facilities Selling and administrative salaries Advertising 14,700 16,000 61,000 24,000 192,000 18,000 3,600 48,000 41,000 86,700 505,000 Net loss $ (10,000) The company's controller resigned a month ago Sam, a new assistant in the controller's office, prepared the income statement above. Sam has had little experience in manufacturing operations After seeing the $10,000 loss for August, Swit's president stated, "I was sure we'd be profitable within six months, but our six months are up and this loss for August is even worse than July's. I think it's time to start looking for someone to buy out the company's assets-if we dont, within a few months there won't be any assets to sell. By the way, I don't see any reason to look for a new controller. We'll just limp along with Sam for the time being Additional information about the company follows a. Some 70% ofthe utilities cost and 70% of the insurance apply to factory operations. The remaining amounts apply to selling and administrative activities b. Inventory balances at the beginning and end of August were as follows Raw materials Work in process Finished goods August1 August 31 $ 25,000 22,000 8,000 23,000 48,000 53,000 c. only 75% of the rent on facilities applies to factory operations, the remainder applies to seling and administrative activities. about whether the company should look for a buyer for its assets Required The president has asked you to check over the income statement and make a recommendation 1. As one step in gathering data for a recommendation to the president, prepare a schedule of cost or goods manufactured in good form for August