Tyler Corporation reports the following results for its first month of operations ended December 31. Overhead is applied using a predetermined overhead rate of 90% of direct materials cost.

Raw materials purchased$ 19,800Sales$ 38,800Direct materials used12,700Cost of goods sold29,100Direct labor used19,800Selling expenses2,800Cost of goods manufactured33,400General and administrative expenses3,900

1. Prepare an income statement for the month ended December 31.
2. Determine the December 31 ending inventory balances for Raw Materials, Work in Process, and Finished Goods. Hint: Because Tyler is in its first month of operations, each account begins with a $0 balance; also, there were no indirect materials used this month.