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I need help calculating the Sales, COGS, Gross Margin, and Operating Income based on the below information. Thank you in advance for any help!
Income Statement
Predetermined Overhead Rate, Application of Overhead to Jobs, Job Cost, Unit Cost
On August 1, Cairle Company's work-in-process inventory consisted of three jobs with the following costs:
Job 70 Job 71 Job 72
Direct materials $1,500 $2,000 $850
Direct labor 1,900 1,300 900
Applied overhead 1,520 1,040 720
During August, four more jobs were started. Information on costs added to the seven jobs during the month is as follows:
Job 70 Job 71 Job 72 Job 73 Job 74 Job 75 Job 76
Direct materials $800 $1,235 $3,600 $5,000 $300 $560 $80
Direct labor 1,000 1,400 2,200 1,800 600 900 180
Before the end of August, Jobs 70, 72, 73, and 75 were completed. On August 31, Jobs 72 and 75 were sold.
Cairle's selling and administrative expenses for August were $1,100. Assume that Cairle prices its jobs at cost plus 20 percent.
Required:
Compose an income statement for Cairle Company for August.
Cairle Company
Income Statement
For the Month of August
Sales$
COG sold$
Gross margin$
Selling and Admin Exp$1,100
Operating income$
Answer & Explanation
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