Question

The following selected account balances are provided for Delray Mfg.

Sales	$	1,220,000
Raw materials inventory, beginning		41,000
Work in process inventory, beginning		57,800
Finished goods inventory, beginning		63,900
Raw materials purchases		199,900
Direct labor		232,000
Factory supplies used (indirect materials)		23,700
Indirect labor		48,000
Repairs—Factory equipment		5,250
Rent cost of factory building		54,000
Advertising expense		110,000
General and administrative expenses		140,000
Raw materials inventory, ending		40,000
Work in process inventory, ending		42,200
Finished goods inventory, ending		72,300
Prepare an income statement for Delray Mfg. (a manufacturer)

DELRAY MFG.
Income Statement
For Year Ended December 31, Year 1
Sales		$1,220,000
Cost of goods sold
Cost of goods manufactured
Cost of goods available for sale	0
Less: Finished goods inventory, ending
Cost of goods sold		0
Gross profit
Operating expenses
Advertising expense
General and administrative expenses
Total operating expenses		0
Operating income		$0

Answer 1