Question

The following information applies to the questions displayed below.) The following calendar year-end information is taken from the December 31, 2015, adjusted trial balance and other records of Leone Company. $ 31,200 10,800 10,200 35,900 103,500 7,900 33,000 Advertising expense Depreciation expense-Office equipment Depreciation expense-Selling equipment Depreciation expense-Factory equipment Factory supervision Factory supplies used Factory utilities Inventories Raw materials, December 31, 2014 Raw materials, December 31, 2015 Work in process, December 31, 2014 Work in process, December 31, 2015 Finished goods, December 31, 2014 Finished goods, December 31, 2015 Direct labor Income taxes expense Indirect labor Miscellaneous production costs Office salaries expense Raw materials purchases Rent expense-Office space Rent expense-Selling space Rent expense-Factory building Maintenance expense-Factory equipment Sales Sales salaries expense $ 687,900 298,100 55,300 9,900 62.000 979,000 25,000 25,800 78,000 39,700 4,495,000 395,500 157,800 178,000 17,800 22,300 169,700 135,800

Please organize the chart as seen and explain all calculations, other wise I will mark as incorrect. Thank You!

Answer 1

Solution

LEONE COMPANY
Income Statement
For the year ended December 31st 2015
Sales		$   44,95,000.00
Cost of Goods Sold
Finished Goods Inventory December 3 2014	$     1,69,700.00
Cost of goods Manufactured	$   20,05,400.00
Goods Available for sale	$   21,75,100.00
Finished Goods Inventory December 3 2015	$     1,35,800.00
Cost of Goods Sold		$   20,39,300.00
Gross Profit from Sales		$   24,55,700.00
Operating Expenses
Selling Expenses
Advertisement Expenses	$         31,200.00
Depreciation-Selling Equipment	$         10,200.00
Rent-Selling Space	$         25,800.00
Sales Salaries expenses	$     3,95,500.00
Total selling Expenses	$     4,62,700.00
General And Administrative Expenses
Depreciation-Office Equipment	$         10,800.00
Office Salaries Expenses	$         62,000.00
Rent expense- Office space	$         25,000.00
Total General and Administrative Expenses	$         97,800.00
Total Operating expenses		$     5,60,500.00
Income before tax		$   18,95,200.00
Income tax expense		$     2,98,100.00
Net income		$   15,97,100.00

Working note

LEONE COMPANY
Cost of Goods Manufactured
For year ended December 31 2015
Direct Material
Raw material Inventory Dec 31 2014	$    1,57,800.00
Raw material Purchased	$    9,79,000.00
Raw material available for use	$ 11,36,800.00
Less: Raw material Inventory December 31 2015	$    1,78,000.00
Direct Material Used		$   9,58,800.00
Direct labor		$   6,87,900.00
Factory Overheads
Factory Supervision	$    1,03,500.00
factory Supplies Used	$          7,900.00
Indirect labor	$        55,300.00
Rent- Factory Building	$        78,000.00
Maintenance - Factory Equipment	$        39,700.00
Depreciation - Factory Equipment	$        35,900.00
Miscelanious Production Cost	$          9,900.00
Factory Utilities	$        33,000.00
Total factory overheads		$   3,63,200.00
Total manufacturing Cost		$ 20,09,900.00
Add: Work in process December 31 2015		$       17,800.00
Total Work in process		20,27,700.00
Less: Work in progress december 31 2015		$       22,300.00
Cost of Goods Manufactured		$ 20,05,400.00