[The following information applies to the questions displayed below.] The follow

Question

[The following information applies to the questions displayed below.]

The following data is provided for Garcon Company and Pepper Company.

Required:
1-a. Prepare income statements for both Garcon Company and Pepper Company.
1-b. Prepare the current assets section of the balance sheet for each company.

Prepare the income statement for Garcon Company.

REQ 1A: Prepare the income statement for Pepper Company.

Prepare the current asset section of the balance sheet for Garcon Company.

REQ 1B:

Prepare the current asset section of the balance sheet for Pepper Company.

REQ 1 B: Pepper

Garcon Company Pepper Company Beginning finished goods inventory $ 12,300 $ 17,800 Beginning work in process inventory 17,700 19,800 Beginning raw materials inventory 7,800 12,900 Rental cost on factory equipment 33,250 26,800 Direct labor 20,200 37,800 Ending finished goods inventory 17,900 16,800 Ending work in process inventory 22,300 18,600 Ending raw materials inventory 5,800 9,600 Factory utilities 10,650 14,000 Factory supplies used 13,300 3,300 General and administrative expenses 23,500 50,500 Indirect labor 1,350 9,580 Repairs—Factory equipment 4,820 3,650 Raw materials purchases 43,000 54,500 Selling expenses 58,400 56,200 Sales 217,530 345,010 Cash 23,000 22,700 Factory equipment, net 222,500 121,825 Accounts receivable, net 13,800 19,950

Explanation / Answer

Garcon company Peppar company Schedule for manufacturing cost beginning raw material 7800 12900 Add Purchase of raw material 43000 54500 Total 50800 67400 Less Ending Raw material 5800 9600 Raw material used in production 45000 57800 Add Direct labor 20200 37800 Prime cost 65200 95600 Add Manufacturing cost Indirect labor 1350 9580 Rent on factory equipment 33250 26800 Factory utilities 10650 14000 Factory supplies used 13300 3300 Repair factory equipment 4820 63370 3650 57330 Total manufacturing cost 128570 152930 Add Beginning work in progress 17700 19800 146270 172730 less Ending work in progress 22300 18600 Cost of goods manufactured 123970 154130 Add Beginning finished goods inventory 12300 17800 Cost of goods available for sale 136270 171930 less Ending finished goods inventory 17900 16800 Cost of goods sold 118370 155130 Income statement Sales 217530 345010 Less Cost of goods sold 118370 155130 Gross profit 99160 189880 Less Expense General and admin expense 23500 50500 Selling expense 58400 81900 56200 106700 Net income 17260 83180 Partial balance sheet Garcon company Current assets Inventory Raw material 5800 Work in progress 22300 Finished goods 17900 Total inventory 46000 Cash 23000 Accounts receivable net 13800 Total current assets 82800 Partial balance sheet Peppar company Current assets Inventory Raw material 9600 Work in progress 18600 Finished goods 16800 Total inventory 45000 Cash 22700 Accounts receivable net 19950 Total current assets 87650

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