Prepare the January income statement for Technology Treasures Manufacturing Company. Technology Treasures Manufacturing Company Income Statement For the Month Ended January 31 Revenues $fill in the blank 3beb37fd1fe4fa1_2 Cost of goods sold fill in the blank 3beb37fd1fe4fa1_4 Gross profit $fill in the blank 3beb37fd1fe4fa1_6 Operating expenses: Selling expenses $fill in the blank 3beb37fd1fe4fa1_8 Administrative expenses fill in the blank 3beb37fd1fe4fa1_10 Total operating expenses fill in the blank 3beb37fd1fe4fa1_11 Net income $fill in the blank 3beb37fd1fe4fa1_13 Feedback a. Consider the differences in the income statement for merchandising and manufacturing businesses. Remember to include cost of goods sold. b. Determine the Materials Inventory, Work in Process Inventory, and Finished Goods Inventory balances at the end of the first month of operations. Technology Treasures Manufacturing Company Inventory Balances For the Month Ended January 31 Inventory balances on January 31: Materials $fill in the blank f0a116fd1fd401b_1 Work in process $fill in the blank f0a116fd1fd401b_2 Finished goods $fill in the blank f0a116fd1fd401b_3
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
The following events took place for Technology Treasures Manufacturing Company during January, the first month of its operations as a producer of digital video monitors:
- Purchased $142,900 of materials.
- Used $126,600 of direct materials in production.
- Incurred $305,300 of direct labor wages.
- Incurred $101,800 of factory
overhead . - Transferred $508,800 of work in process to finished goods.
- Sold goods for $742,000.
- Sold goods with a cost of $445,200.
- Incurred $106,000 of selling expense.
- Incurred $67,800 of administrative expense.
Using the information given, complete the following:
a. Prepare the January income statement for Technology Treasures Manufacturing Company.
| Technology Treasures Manufacturing Company | ||
| Income Statement | ||
| For the Month Ended January 31 | ||
| Revenues | $fill in the blank 3beb37fd1fe4fa1_2 | |
| Cost of goods sold | fill in the blank 3beb37fd1fe4fa1_4 | |
| Gross profit | $fill in the blank 3beb37fd1fe4fa1_6 | |
| Operating expenses: | ||
| Selling expenses | $fill in the blank 3beb37fd1fe4fa1_8 | |
| Administrative expenses | fill in the blank 3beb37fd1fe4fa1_10 | |
| Total operating expenses | fill in the blank 3beb37fd1fe4fa1_11 | |
| Net income | $fill in the blank 3beb37fd1fe4fa1_13 |
a. Consider the differences in the income statement for merchandising and manufacturing businesses. Remember to include cost of goods sold.
b. Determine the Materials Inventory, Work in Process Inventory, and Finished Goods Inventory balances at the end of the first month of operations.
| Technology Treasures Manufacturing Company | |
| Inventory Balances | |
| For the Month Ended January 31 | |
| Inventory balances on January 31: | |
| Materials | $fill in the blank f0a116fd1fd401b_1 |
| Work in process | $fill in the blank f0a116fd1fd401b_2 |
| Finished goods | $fill in the blank f0a116fd1fd401b_3 |
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