Financial Statements of a Manufacturing FirmThe following events took place for Sorensen Manufacturing Company during January, the first month of its operations as a producer of digital video monitors:Purchased $59,500 of materials.Used $45,800 of direct materials in production.Incurred $68,400 of direct labor wages.Incurred $96,400 of factory overhead.Transferred $160,100 of work in process to finished goods.Sold goods for $286,200.Sold goods with a cost of $127,300.Incurred $73,200 of selling expense.Incurred $32,100 of administrative expense.Using the information given, complete the following:a. Prepare the January income statement for Sorensen Manufacturing Company.Sorensen Manufacturing CompanyIncome StatementFor the Month Ended January 31 $ $Operating expenses: $ Total operating expenses $b. Determine the inventory balances at the end of the first month of operations.Sorensen Manufacturing CompanyInventory BalancesFor the Month Ended January 31Inventory balances on January 31: Materials$Work in process Finished goods

Answered: Financial Statements of a Manufacturing…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter1: Introduction To Managerial Accounting

Section: Chapter Questions

Problem 9E: Financial statements of a manufacturing firm The following events took place for Sorensen...

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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 $59,500 of materials.
Used $45,800 of direct materials in production.
Incurred $68,400 of direct labor wages.
Incurred $96,400 of factory overhead.
Transferred $160,100 of work in process to finished goods.
Sold goods for $286,200.
Sold goods with a cost of $127,300.
Incurred $73,200 of selling expense.
Incurred $32,100 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
		$

		$
Operating expenses:
	$

Total operating expenses
		$

b. Determine the inventory balances at the end of the first month of operations.

Sorensen Manufacturing Company
Inventory Balances
For the Month Ended January 31
Inventory balances on January 31:
Materials	$
Work in process
Finished goods

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