The following events took place for Chi-Lite Inc. during June, the first month of operations as a producer of road bikes:•Purchased $403,440 of materials.•Used $340,060 of direct materials in production.•Incurred $294,500 of direct labor wages.•Applied factory overhead at a rate of 79% of direct labor cost.•Transferred $819,120 of work in process to finished goods.•Sold goods with a cost of $781,630.•Sold goods for $1,402,470.•Incurred $315,200 of selling expenses.•Incurred $127,070 of administrative expenses. Required: a. Prepare the June income statement for Chi-Lite. Assume that Chi-Lite uses the perpetual inventory method. Refer to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. Colons (:) will fill in where needed. b. Determine the inventory balances at the end of the first month of operations.

A) Chi - Lite Inc. Income statement For the month ended 30 June Sales 1402470…

Answered: The following events took place for…

Managerial Accounting

15th Edition

ISBN:9781337912020

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

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

Chapter2: Job Order Costing

Section: Chapter Questions

Problem 14E: The following events took place for Rushmore Biking Inc. during February, the first month of...

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The following events took place for Chi-Lite Inc. during June, the first month of operations as a producer of road bikes:

•	Purchased $403,440 of materials.
•	Used $340,060 of direct materials in production.
•	Incurred $294,500 of direct labor wages.
•	Applied factory overhead at a rate of 79% of direct labor cost.
•	Transferred $819,120 of work in process to finished goods.
•	Sold goods with a cost of $781,630.
•	Sold goods for $1,402,470.
•	Incurred $315,200 of selling expenses.
•	Incurred $127,070 of administrative expenses.

	Required:
	a. Prepare the June income statement for Chi-Lite. Assume that Chi-Lite uses the perpetual inventory method. Refer to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. Colons (:) will fill in where needed.
	b. Determine the inventory balances at the end of the first month of operations.

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