Inventive Controls Ltd. was incorporated and started business early in January 2012 to manufacture electronic control devices to monitor traffic. Inventive purchased a small manufacturing plant and office building in a new industrial park and was in operation immediately. General ledger account balances at December 31, 2012 are as follows:
General ledger accountAmount
Sales commissions……………………………………………..S 75,000
Supervisory salaries, production manager………………………..65,000
Executive salaries…………………………………………..........100,000
Raw material purchases………………………………………….123,500
Miscellaneous plant supplies………………………………...........12,400
Amortization, office building………………………………………8,000
Amortization, plant equipment……………………………...........10,000
Property taxes (1/5 for office building, 4/5 for plant building)……5,000
Sales…………………………………………………………….527,000
Direct labour……………………………………………………..62,000
Raw material inventory, December 31, 2012……………………14,600
Utilities expense (1/10 related to the office)…………………….20,000
General administration expenses…………………………………38,800
At December 31, 2012, there was no work-in-process, but 20% of the units manufactured remained in ending finished goods inventor)'. Inventive uses the straight-line method to calculate amortization.
Required:
a. Compute the value of cost of goods sold and ending finished goods inventory under IFRS.
b. Prepare an income statement for Inventive for the year ended December 31, 2012.