The following events took place for Migliozzi Inc. during July, the first month of operations as a producer of road bikes:•Purchased $397,940 of materials•Used $343,700 of direct materials in production•Incurred $290,100 of direct labor wages•Applied factory overhead at a rate of 80% of direct labor cost•Transferred $813,970 of work in process to finished goods•Sold goods with a cost of $799,480•Sold goods for $1,405,850•Incurred $319,590 of selling expenses•Incurred $125,080 of administrative expenses Required:a.Prepare the July income statement for Migliozzi. Assume that Migliozzi uses the perpetual inventory method. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Expenses should be positive. b.Determine the inventory balances at the end of the first month of operations. **Instruction for Preparing an Income Statement:**a. Prepare the July income statement for Migliozzi. Assume that Migliozzi uses the perpetual inventory method. Be sure to complete the statement heading. Refer to the list of Accounts, Labels, and Amount Descriptions provided for the exact wording of the answer choices for text entries. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Expenses should be positive. Colons (:) will fill in where needed.---**Migliozzi Inc.****Income Statement**| | ||--------------------------|--------|| _(Label)_ | || 1 | || 2 | || 3 | || 4 _(Label)_ | || 5 | || 6 | || 7 | || 8 | |---**Explanation of Layout:**The table is structured to present financial data for Migliozzi Inc. under an income statement. The statement is divided into rows, some marked for labels and others for numerical entries (likely financial figures). There are placeholder labels to guide where specific financial data or categories should be entered, and each data point should align to the context of an income statement, such as revenues, expenses, and net income or loss. ### Determine the Inventory Balances at the End of the First Month of Operations**Materials Inventory, July 31** [Input box for dollar amount]**Work in Process Inventory, July 31** [Input box for dollar amount]**Finished Goods Inventory, July 31** [Input box for dollar amount]This form aims to calculate the different types of inventory balances at the end of the first operational month, specifically for July 31. Each category requires the input of a dollar amount to reflect the inventory status.

The income statement represents the net income or net loss for the company. It is calculated by…

Answered: The following events took place for…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The following events took place for Migliozzi Inc. during July, the first month of operations as a producer of road bikes:

•	Purchased $397,940 of materials
•	Used $343,700 of direct materials in production
•	Incurred $290,100 of direct labor wages
•	Applied factory overhead at a rate of 80% of direct labor cost
•	Transferred $813,970 of work in process to finished goods
•	Sold goods with a cost of $799,480
•	Sold goods for $1,405,850
•	Incurred $319,590 of selling expenses
•	Incurred $125,080 of administrative expenses

Required:

a.	Prepare the July income statement for Migliozzi. Assume that Migliozzi uses the perpetual inventory method. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Expenses should be positive.
b.	Determine the inventory balances at the end of the first month of operations.

**Instruction for Preparing an Income Statement:**

a. Prepare the July income statement for Migliozzi. Assume that Migliozzi uses the perpetual inventory method. Be sure to complete the statement heading. Refer to the list of Accounts, Labels, and Amount Descriptions provided for the exact wording of the answer choices for text entries. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Expenses should be positive. Colons (:) will fill in where needed.

---

**Migliozzi Inc.**

**Income Statement**

| | |
|--------------------------|--------|
| _(Label)_ | |
| 1 | |
| 2 | |
| 3 | |
| 4 _(Label)_ | |
| 5 | |
| 6 | |
| 7 | |
| 8 | |

---

**Explanation of Layout:**

The table is structured to present financial data for Migliozzi Inc. under an income statement. The statement is divided into rows, some marked for labels and others for numerical entries (likely financial figures). There are placeholder labels to guide where specific financial data or categories should be entered, and each data point should align to the context of an income statement, such as revenues, expenses, and net income or loss.

### Determine the Inventory Balances at the End of the First Month of Operations

**Materials Inventory, July 31**
[Input box for dollar amount]

**Work in Process Inventory, July 31**
[Input box for dollar amount]

**Finished Goods Inventory, July 31**
[Input box for dollar amount]

This form aims to calculate the different types of inventory balances at the end of the first operational month, specifically for July 31. Each category requires the input of a dollar amount to reflect the inventory status.

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