Empire Company is a manufacturer of smartphones. Its controller resigned in October 2020. An inexperienced assistant account has prepared the following income statement for the month of October 2020.
- Inventory balances at the beginning and end of October were:
- Only 75% of the utilities expense and 60% of the insurance expense apply to factory operations. The remaining amounts should be charged to selling and administrative activities
Instructions
- Prepare a schedule of cost of goods manufactured for October 2020.
- Prepare an correct income statement for October 2020.
Solution
a.
Empire Company
Cost of goods manufactured schedule
For the Month Ended October 31, 2020
Cost of goods manufactured schedule
For the Month Ended October 31, 2020
b.
Empire Company
Income Statement (Partial)
For the Year Ended June 30, 2021
Income Statement (Partial)
For the Year Ended June 30, 2021
