Munoz Manufacturing Company was started on January 1, Year 1, when it acquired $2,900 cash from the issue of common stock. During the first year of operation, $1,700 of direct raw materials was purchased with cash, and $1,050 of the materials was used to make products. Direct labor costs of $1,900 were paid in cash. Mun oz applied $730 of overhead cost to the Work in Process account. Cash payments of $730 were were made for actual overhead costs. The company completed products that cost $2,500 and sold goods that had cost $1,920 for $2,900 cash. Selling and administrative expenses of $570 were paid in cash.
Munoz Manufacturing Company was started on January 1, Year 1, when it acquired $2,900 cash from the issue of common stock. During the first year of operation, $1,700 of direct raw materials was purchased with cash, and $1,050 of the materials was used to make products. Direct labor costs of $1,900 were paid in cash. Mun oz applied $730 of overhead cost to the Work in Process account. Cash payments of $730 were were made for actual overhead costs. The company completed products that cost $2,500 and sold goods that had cost $1,920 for $2,900 cash. Selling and administrative expenses of $570 were paid in cash.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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prepare an income statement
Transcribed Image Text:Munoz Manufacturing Company was started on January 1, Year 1, when it acquired $2,900 cash from the issue of common stock.
During the first year of operation, $1,700 of direct raw materials was purchased with cash, and $1,050 of the materials was used to
make products. Direct labor costs of $1,900 were paid in cash. Mun oz applied $730 of overhead cost to the Work in Process account.
Cash payments of $730 were were made for actual overhead costs. The company completed products that cost $2,500 and sold
goods that had cost $1,920 for $2,900 cash. Selling and administrative expenses of $570 were paid in cash.
Transcribed Image Text:Prepare an income statement.
MUNOZ MANUFACTURING COMPANY
Income Statement
For the Year Ended December, Year 1
$
Sales revenue
Cost of goods sold
Gross margin
Selling and administrative expenses
$
2,900
1,900
1,000
570
430
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