Financial statements of a manufacturing firm
The following events took place for Sorensen Manufacturing Company during January, the first month of its operations as a producer of digital video monitors:
Purchased $249,000 of materials. Used $179,280 of direct materials in production. Incurred $448,200 of direct labor wages. Incurred $179,300 of factory overhead. Transferred $757,000 of work in process to finished goods. Sold goods for $1,195,200. Sold goods with a cost of $672,300. Incurred $214,100 of selling expense. Incurred $124,500 of administrative expense.
This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below.
- Use “f, g, h, and i” in preparing the income statement.
- Show the transactions in T accounts for materials, work in process, and finished goods.