Watkins & Reinhardt Manufacturing Company has the following cost and expense data for the year ending December 31, 2008. Raw Materials, 1/1/08 $30,000 Insurance, factory $14,000 Raw Materials, 12/31/08 20,000 property taxes, factory building 6,000 Raw materials purchases 205,000 sales (net) 1,500,000 Indirect materials 15,000 delivery expenses 100,000 Work in process, 1/1/08 80,000 sales commisions 150,000 Work in process, 12/31/08 50,000 indirect labor 90,000 Finished goods, 1/1/08 110,000 factory machinery rent 40,000 Finished goods, 12/31/08 120,000 factory utilities 65,000 Direct Labor 350,000 depreciation, factory building 24,000 Factory manager's salary 35,000 administrative expenses 300,000 (a) Prepare a cost of goods manufactured schedule for Watkins & Reinhardt Manufacturing Company for 2008. (a) Watkins & Reinhardt Manufacturing Company Cost of Goods Manufactured Schedule For the year ended, December 31, 2008 Work in process, 1/1/08 Direct Materials Raw materials inventory 1/1 Total raw materials available for use Less: Direct Materials used Direct Labor Manufacturing Overhead Total manufacturing overhead costs Total Manufacturing costs Total cost of work in process Less: Cost of goods manufactured (b) Prepare an income statement for Watkins & Reinhardt Manufacturing Company for 2008. Watkins & Reinhardt Manufacturing Company Income Statement For the year ended, December 31, 2008 Net Sales Cost of Goods Sold Finished goods inventory, 1/1 Total cost of goods available for sale Less: Cost of Goods Sold Gross Profit Operating expenses Total operating expenses Net Income

Watkins & Reinhardt Manufacturing Company has the following cost and expense data for the year ending December 31, 2008. Raw Materials, 1/1/08 $30,000 Raw Materials, 12/31/08 20,000 Raw materials purchases 205,000 Insurance, factory property taxes, factory building sales (net) $14,000 6,000 1,500,000 Indirect materials 15,000 delivery expenses 100,000 Work in process, 1/1/08 80,000 sales commisions 150,000 50,000 Work in process, 12/31/08 indirect labor 90,000 110,000 factory machinery rent 40,000 Finished goods, 12/31/08 120,000 factory utilities 65,000 Direct Labor 350,000 depreciation, factory building Finished goods, 1/1/08 Factory manager's salary 35,000 administrative expenses (a) Prepare a cost of goods manufactured schedule for Watkins & Reinhardt Manufacturing Company for 2008. (a) Watkins & Reinhardt Manufacturing Company Cost of Goods Manufactured Schedule For the year ended, December 31, 2008 Work in process, 1/1/08 Direct Materials Raw materials inventory 1/1 Total raw materials available for use Less: Direct Materials used Direct Labor Manufacturing Overhead Total manufacturing overhead costs Total Manufacturing costs Total cost of work in process Less: Cost of goods manufactured (b) Prepare an income statement for Watkins & Reinhardt Manufacturing Company for 2008. Watkins & Reinhardt Manufacturing Company Income Statement For the year ended, December 31, 2008 Net Sales Cost of Goods Sold Finished goods inventory, 1/1 Total cost of goods available for sale Less: Cost of Goods Sold Gross Profit Operating expenses Total operating expenses Net Income 24,000 300,000