Valenko Company provided the following account balances for the year ended December 31

Valenko Company provided the following account balances for the year ended December 31 (all raw materials are used in production as direct materials):

Selling expenses	$	217,000
Purchases of raw materials	$	264,000
Direct labor		?
Administrative expenses	$	159,000
Manufacturing overhead applied to work in process	$	334,000
Total actual manufacturing overhead costs	$	352,000

Inventory balances at the beginning and end of the year were as follows:

 

	Beginning of Year			End of Year
Raw materials	$	55,000		$	37,000
Work in process		?		$	27,000
Finished goods	$	37,000			?

The total manufacturing costs for the year were $685,000; the cost of goods available for sale totaled $735,000; the unadjusted cost of goods sold totaled $664,000; and the net operating income was $38,000. The company’s overapplied or underapplied overhead is closed entirely to cost of goods sold.

Required:

a.	Prepare a schedule of cost of goods manufactured. (Input all amounts as positive values. Omit the "$" sign in your response.)

  

Valenko Company Schedule of Cost of Goods Manufactured
Direct materials:
Raw materials inventory, beginning	$ 55,000
Add  : Purchases of raw materials	264,000
Total raw materials available	319,000
Deduct  : Raw materials inventory, ending	37,000
Raw materials used in production		282,000
Direct labor		69,000
Manufacturing overhead applied to work in process inventory		334,000
Total manufacturing cost		685,000
Add  : Beginning work in process inventory		40,000
		725,000
Deduct  : Ending work in process inventory		27,000
Cost of goods manufactured		$ 698,000

  

b.	Prepare a schedule of cost of goods sold. (Input all amounts as positive values. Omit the "$" sign in your response.)

  

Valenko Company Schedule of Cost of Goods Sold
Finished goods inventory, beginning	$ 37,000
Add  : Cost of goods manufactured	698,000
Cost of goods available for sale	735,000
Deduct  : Finished goods inventory, ending	71,000
Unadjusted cost of goods sold	664,000
Add  : Underapplied overhead	18,000
Adjusted cost of goods sold	$ 682,000

c.	Prepare an income statement for the year. (Input all amounts as positive values. Omit the "$" sign in your response.)

Valenko Company Income Statement
Sales		$ 1096000
Cost of goods sold		682,000
Gross margin		414000
Selling and administrative expenses:
Administrative expense	$
Selling expenses		376,000
Net operating income		$ 38,000