The following events took place for Sorensen Manufacturing Company during January, the first month of its operations as a producer of digital video monitors:

	a. Purchased $137,800 of materials.
	b. Used $94,100 of direct materials in production.
	c. Incurred $184,800 of direct labor wages.
	d. Incurred $212,720 of factory overhead.
	e. Transferred $423,160 of work in process to finished goods.
	f. Sold goods for $645,000.
	g. Sold goods with a cost of $365,000.
	h. Incurred $86,260 of selling expense.
	i. Incurred $71,950 of administrative expense.

Required:

Using the information given, complete the following:

a. Prepare the January income statement for Sorensen Manufacturing Company. Be sure to complete the statement heading. Refer to the list of Accounts, Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Expenses should be positive.

b. Determine the inventory balances at the end of the first month of operations.