The following events took place for Video Wave Manufacturing Company during January 2016, the first month of its operations as a producer of digital video monitors:
a. Purchased $138,800 of materials.
b. Used $94,780 of direct materials in production.
c. Incurred $181,280 of direct labor wages.
d. Incurred $213,200 of factory overhead.
e. Transferred $428,060 of work in process to finished goods.
f. Sold goods with a cost of $360,750.
g. Earned revenues of $654,000.
h. Incurred $85,320 of selling expense.
i. Incurred $70,650 of administrative expense.
Required:
Using the information given, complete the following:
A. Prepare the January 2016 income statement for Video Wave Manufacturing Company. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.
B. Determine the inventory balances at the end of the first month of operations.