colin company 496590

The following account balances were taken from the records of Colin Company at the beginning of 2011:

Cash $2,500

Common stock $2,250

Retained earnings $950

Raw materials inventory $300

Work in process inventory $220

Finished good inventory (50 units @ $3.60/unit) $180

The following transactions occurred during 2011:

1. Purchased $750 of raw materials with cash

2. Transferred $500 of raw materials to the production department.

3. Incurred and paid cash for 80 hours of direct labor at $7.50 per hour.

4. Applied overhead using a predetermined overhead rate of $8.00 per direct labor hour.

5. Incurred actual overhead costs of $650 cash.

6. Completed work on 300 units for $3.40 per unit.

7. Paid $200 in selling and administrative expenses in cash.

8. Sold 200 units for $1,500 cash. Assume FIFO inventory or the first units completed are the first units sold to customers.

Required:

1. Trace the flow of inventory for these transactions using Row Material, Work in Process, Finished Goods, COGS and Manufacturing OH T accounts. Exclude the cash account.
2. Prepare an income statement for 2011.