Problem $10-24$A $($Static$)$ Product versus SG&A costs LO $10-3$

The following transactions pertain to year $1,$ the first$-$year operations of Gibson Company. All inventory was started and completed

during year $1.$ Assume that all$-$transactions are cash transactions.

Acquired $$12,000$ cash by issuing common stock.

Paid $$4,700$ for materials used to produce inventory.

Paid $$2,400$ to production workers.

Paid $$900$ rental fee for production equipment.

Paid $$350$ to administrative employees.

Paid $$400$ rental fee for administrative office equipment.

Produced $400$ units of inventory of which $360$ units were sold at a price of $$25$ each.

Required

Prepare an income statement and a balance sheet in accordance with GAAP.

Fill in the blanks for both the Income Statement and Balance Sheet with the following options:

Accounts payable

Accounts Receivable

Accumulated depreciation

administrative expenses

advertising expense

Cash

common Stock

cost of goods sold

depreciation expense

downstream costs

finished goods inventory

inventory holding expense

manufacturing equipment

office equipment

office furniture

office supplies

operating expense

product design expense

raw materials inventory

rental equipment

research & development expense

retained earnings

salaries expense

sales commissions

sales revenue

selling and administrative depreciation expense

selling and administrative salaries expense

upstream costs

utility expense

work in process inventory