The following events took place for Rushmore Biking Inc. during February, the first month of operations as a producer of road bikes:
• Purchased $221,600 of materials.
• Used $190,600 of direct materials in production.
• Incurred $164,000 of direct labor wages.
• Applied factory overhead at a rate of 80% of direct labor cost.
• Transferred $466,400 of work in process to finished goods.
• Sold goods with a cost of $438,800.
• Revenues earned by selling bikes, $785,500.
• Incurred $188,700 of selling expenses.
• Incurred $70,200 of administrative expenses.
Question Content Area
a. Prepare the income statement for Rushmore Biking Inc. for the month ending February 28. Assume that Rushmore Biking Inc. uses the perpetual inventory method.