Financial Statements of a Manufacturing Firm The following events took place for
ID: 2339725 • Letter: F
Question
Financial Statements of a Manufacturing Firm
The following events took place for Chi-Lite Inc. during June, the first month of operations as a producer of road bikes:
a. Prepare the June income statement for Chi-Lite. Assume that Chi-Lite uses the perpetual inventory method.
• Purchased $481,100 of materials. • Used $413,700 of direct materials in production. • Incurred $356,000 of direct labor wages. • Applied factory overhead at a rate of 80% of direct labor cost. • Transferred $1,012,300 of work in process to finished goods. • Sold goods with a cost of $962,200. • Sold goods for $1,722,300. • Incurred $413,700 of selling expenses. • Incurred $154,000 of administrative expenses.Explanation / Answer
Answer
Chi-Lite Inc.
Income Statement
For the Month Ended June 30
Revenues
$ 1,722,300.00
Cost of Goods Sold
$ 962,200.00
Gross Profit
$ 760,100.00
Selling and Administrative Expenses:
Selling Expenses
$ 413,700.00
Administrative Expenses
$ 154,000.00
Total Selling and Administrative Expenses
$ 567,700.00
Income from Operations
$ 192,400.00
Chi-Lite Inc.
Income Statement
For the Month Ended June 30
Revenues
$ 1,722,300.00
Cost of Goods Sold
$ 962,200.00
Gross Profit
$ 760,100.00
Selling and Administrative Expenses:
Selling Expenses
$ 413,700.00
Administrative Expenses
$ 154,000.00
Total Selling and Administrative Expenses
$ 567,700.00
Income from Operations
$ 192,400.00
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