Question

-வாயா - Financial statements of a manufacturing firm Instructions Accounts, Labels and Amount Descriptions Income Statement The following everytis took place for Sorensen Manufacturing Company during January, the first month of its operations as a producer of digital video monitors a. Purchased $250,000 of materials b. Used $180,000 of direct materials in production c. Incurred $450,000 of direct labor wages d. Incurred $180,000 of tactory overhead e Transferred $760,000 of work in process to finished goods. 1. Sold goods for $1,200,000 g Sold goods with a cost of $675,000 h. Incurred $215,000 of selling expense Lincurred $125,000 of administrative expens Required: Using the information given, complete the following: Prepare the January income statement for Sorensen Manufacturing Company. Be sure to complete the statement reading Refer to the Bar of Accounts, Labels and Amount Descriptions provided for the exact wording of the answer choice for A con tomatically required Enter amounts p e r the amount calon har results in a negative amount For example: Netloss should be regate Expenses should be post b. Determine the inventory balances at the end of the first month of Check My Work

Answer 1

Solution:-

a.

Sorensen Manufacturing Company
Income Statement
For the month ended January
Sales		1,200,000
Cost of goods sold		675,000
Gross Profit		525,000
Operating Expenses:
Selling Expense	215,000
Administrative Expense	125,000
Total Operating Expenses		340,000
Net Income		185,000

b.

Material

70,000

Explanation:-

250,000 - 180,000 = 70,000

Work In Process

50,000

Explanation:-

180,000 + 450,000 + 180,000 - 760,000 = 50,000

Finished Goods

85,000

Explanation:-

760,000 - 675,000 = 85,000

Please Rate or comment if you have doubt regarding this solution.