The following information is available for Tomlin Company.

	January 1, 2020	2020	December 31, 2020
Raw materials inventory	$21,000		$30,000
Work in process inventory	13,500		17,200
Finished goods inventory	27,000		21,000
Materials purchased		$150,000
Direct labor		220,000
Manufacturing overhead		180,000
Sales revenue		910,000
Selling expenses		50,000
Administrative expenses		80,000

Required

1. Determine cost of goods manufactured. (3 marks)
2. Prepare an income statement (3 marks)
3. Describe the differences between merchandising and manufacturing companies with respect to income statement and balance sheet. (3 marks)