I only need for question 2:

Selected account balances for the year ended December 31 are provided below for BFun Company:

Sales revenue ...............................................................$1,000,000

Selling and administrative salaries..................................$110,000

Purchases of raw materials .............................................$290,000

Direct labor ..................................................................................?

Advertising expense ..........................................................$80,000

Manufacturing overhead ................................................$270,000

Sales Commissions ............................................................$50,000

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

Beginning of End of

the Year the Year

Raw materials: $40,000 $10,000

Work in process: ? $35,000

Finished goods: $50,000 ?

The total manufacturing costs for the year were $683,000; the goods available for sale totaled $740,000, and the cost of goods sold totaled $660,000.

Required:

1. Calculate the following:

a. Direct material used in production

• 320,000.00 (40,000 + 290,000 - 10,0000)

b. Direct labor added to production

• 93,000.00 (683,000-320,000-270,000)

c. Ending finished goods inventory

• 80,000 ( 740,000- 660,000)

d. Cost of goods manufactured

• 690,000.00 (740,000 - 50,000)

e. Beginning work in process inventory

- 42,000.00 (690,000 - 683,000 + 35,000)

2. Use the information above to complete a traditional income statement. Show gross

margin/profit and net operating income.: ( I need equations for this, and how you got these numbers for Question 2)