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Cost of Goods Sold and Income Statements Baker Co.

Baker Co., a manufacturer, had these beginning and ending inventories at the end of its current year
                                  Beginning                Ending
Raw materials               $22,000             $30,000
Work in process             40,000               48,000
Finished goods               25,000               18,000
During the year the following transactions occurred
Raw materials purchased $300,000
Indirect materials and supplies purchased 50,000
Direct labor cost 120,000*
Indirect factory labor 60,000*
Property taxes and depreciation on factory building 20,000
Property taxes and depreciation on salesroom and office (shared on a 50%-50% basis) 15,000
Utilities (60% to factory, 20% to salesroom, and 20% to office). . $ 50,000
Indirect materials issued to factory 40,000
Factory overhead applied on the basis of 120% of direct labor cost ?
Salesmen's salaries 40,000*
Office salaries 24,000*
Sales on account 730,000
Over- or underapplied factory overhead is deducted from or added to cost of goods sold.
*Assume no payroll deductions are made.

Required: (1) Draw up T accounts, and post the data therein. (Credit purchases and payroll to Accounts Payable.)
(2) A cost of goods sold statement.
(3) An income statement.
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