Raw materials inventory, beginning $ 122,000 Raw materials inventory, ending 127,000 Work in process inventory, beginning 37,000 Sales 2,122,000 Work in process inventory, ending 41,000 Finished goods inventory, beginning 52,000 Finished goods inventory, ending 60,000
prepare the current income statement
To prepare the current income statement, we need the following information:
Sales revenue: $2,122,000
Cost of goods sold: This can be calculated by adding the beginning inventory of raw materials, purchases of raw materials, and direct labor costs, and deducting the ending inventory of raw materials, work in process, and finished goods.
1. Calculate the cost of raw materials used:
Raw materials used = Beginning raw materials inventory + Purchases of raw materials - Ending raw materials inventory
Raw materials used = $122,000 + Purchases - $127,000
2. Calculate the cost of goods manufactured:
Cost of goods manufactured = Raw materials used + Direct labor costs + Manufacturing overhead
Cost of goods manufactured = Raw materials used + Direct labor costs + (Work in process inventory, ending - Work in process inventory, beginning)
Cost of goods manufactured = Raw materials used + Direct labor costs + ($41,000 - $37,000)
3. Calculate the cost of goods sold:
Cost of goods sold = Cost of goods manufactured + Beginning finished goods inventory - Ending finished goods inventory
Cost of goods sold = Cost of goods manufactured + $52,000 - $60,000
Now, with all the information, we can prepare the current income statement:
Current Income Statement:
Sales revenue: $2,122,000
Cost of goods sold: Calculated above
Gross profit: Sales revenue - Cost of goods sold
Additional expenses such as operating expenses, taxes, and interest are typically not provided in the information given and would need to be included separately if available.