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09/08/2022
Recording events in T-accounts and preparing financial statements Frazier Manufacturing Company…
Recording events in T-accounts and preparing financial statements Frazier Manufacturing Company was started on January 1, 2005, when it acquired $2,000 cash from the issue of common stock. During the first year of operation, $800 of direct raw materials was purchased with cash, and $600 of the materials was used to make products. Direct labor costs of $1,000 were paid in cash. Frazier applied $640 of overhead cost to the Work in Process account. Cash payments of $640 were made for actual overhead costs. The company completed products that cost $1,600 and sold goods that had cost $1,200 for $2,000 cash. Selling and administrative expenses of $480 were paid in cash. Required a. Open T-accounts and record the events affecting Frazier Manufacturing. Include closing entries. b. Prepare a schedule of cost of goods manufactured and sold, an income statement, a balance sheet, and a statement of cash flows. c. Explain the difference between net income and cash flow from operating activities.
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