Vasani House Company produces numerous fabrics for use in automobile, airplane, and boat seats. For last year, Vasani House reported the following:

Last year, Vasani House produced 6,800 units and sold 7,000 units at $250 per unit.

Required:
1. Prepare a statement of cost of goods manufactured.
2. Prepare an absorption-costing income statement.

Transcribed Image Text:

Work-in-process inventory, January 1 Work-in-process inventory, December 31 Finished goods inventory, January 1 Finished goods inventory, December 31 Direct materials inventory, January 1 Direct materials inventory, December 31 Direct materials purchased Direct labor Plant depreciation Salary, production supervisor Indirect labor Utilities, factory Sales commissions Salary, sales supervisor Depreciation, factory equipment Administrative expenses Supplies (70% used in the factory, 30% used in the sales office) Advertising expense $ 28,750 23,250 46,500 49,000 12,050 13,550 241,000 485,000 75,900 88,100 58,800 40,700 62,000 75,000 28,000 288,600 80,000 53,400