Question

E Calculator Financial Statements of a Manufacturing Firm The following events took place for Sorensen Manufacturing Company during January, the first month of Rs operations as a producer of digital video monitors a. Purchased $41,900 of materials. b. Used $32,300 of direct materials in production. c. Incurred $48,200 of direct labor wages. d. Incurred $67,900 of factory overhead. e. Transferred $112,700 of work in process to finished goods. f. Sold goods for $201.500. 9. Sold goods with a cost of $89,700. h. Incurred $51,500 of selling expense. 1. Incurred $22,600 of administrative expense. Using the information given, complete the following: a. Prepare the January income statement for Sorensen Manufacturing Company Sorensen Manufacturing Company Income Statement For the Month Ended January 31 Revenues $ 201,500 Cost of goods sold -89.700 Gross profit $ 111,800 Operating expenses: Selling expenses dministrative expenses Total operating expense All Wo save

Answer 1

Income statement
For the month ended january 31
Revenues				201500
Cost of goods sold				-89700
Gross profit				111800
operating expenses:
selling expenses			-51500
administrative expenses			-22600
Total operating expenses				-74100
Net income				37700
b) Inventory balances
inventory balances on january 31:
materials (41900-32300)				9600
work in process (32300+48200+67900-112700)				35700
Finished goods (112700-89700)				23000

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