Final answer:
To determine the cost statement and net income, costs for materials, labour, and overhead were calculated, then subtracted from revenue. Total materials used was $27,200; total explicit costs totalled $534,480, resulting in a net income of $315,520.
Step-by-step explanation:
To calculate the cost statement and net income for the medical centre, you start by reviewing the costs and revenues. Let's list down the provided values first.
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- Revenue: $850,000
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- Maintenance and Repair: $40,800
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- Indirect Labour: $32,300
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- Direct Materials Purchase: $166,600
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- Medical Centre Utilities: $28,900
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- Office General and Admin: $121,040
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- Ending Direct Materials: $161,500
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- Beginning Direct Materials Inventory: $22,100
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- Advertising Expense: $114,920
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- Direct Labour: $141,100
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- Medical Centre Insurance: $15,300
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- Indirect Materials: $12,920
Next, calculate the total cost of materials used by subtracting the Ending Direct Materials from the sum of Beginning Direct Materials Inventory and Direct Materials Purchase.
Total Explicit Costs will include Maintenance and Repair, Indirect Labour, Total Materials Used, Medical Centre Utilities, Office General and Admin, Advertising Expense, Direct Labour, Medical Centre Insurance, and Indirect Materials
Lastly, we find the Net Income by subtracting Total Explicit Costs from Revenue.Net Income: $850,000 - $534,480 = $315,520Therefore, the final answer for the net income is $315,520.