The accountant failed to account for an environmental carbon tax due on the companys utilities cost. The tax is presently equal to 40% of the factory utilities, and should be classified as a manufacturing overhead. This adjustment does not affect the companys income tax calculation.

The company gives customers a 2% sales discount, but this has not been accounted for. As a result, total sales annual revenue must be reduced by the amount of the discount. The discount rate may change in the future, so must be added to the original data sheet as a key variable, and the amounts of both gross and net revenue must be shown as line items in the income statement.

The annual insurance charge expense for the factory was $20,000. This was omitted from the original list of expenses in the data sheet. Add this extra manufacturing expense to your "data" sheet.

Administrative salaries of $10,000 were also omitted. Add this to the "data" tab as well.

The government has increased the threshold for paying 20% income tax to $200,000. The new threshold is effective from January 1 2016. Modify your data sheet and formula to reflect this change.

The annual interest expense was only $1,000.

Add a comment box to the Net Income/Loss cell that explains the impact that changes (i) to (vi) have on reported net income - does the company now report a net income or loss for 2016? Make sure this comment box is visible and printed on your worksheet.

1 Holt Manufacturing 2 Cost of Goods Manufactured 3 For the year ended December 31 2016 5 Beginning raw materials inventory 175,000 6 Purchases of raw materials 460,000 7 Total direct materials available 635,000 8 Less: ending inventory of raw materials (25,000) 9 Total raw materials used in production 10 11 Direct labor 12 13 Manufacturing overhead 14 15 Total manufacturing costs added 16 Add: beginning work in process 18 Less: ending work in process 19 Cost of goods manufactured 20 610,000 340,000 450,000 1,400,000 150.000 1,550,000 (350,000) 1,200,000