Inventive Controls Ltd At December 31, 2019, There Was No Work-In-Process, but 30

question 87

Essay

Inventive Controls Ltd. was incorporated and started business early in January 2019 to manufacture electronic control devices to monitor traffic. Inventive purchased a small manufacturing plant and office building in a new industrial park and was in operation immediately. General ledger account balances at December 31, 2019 are as follows:
$$\begin{array} { l | r | } \hline \text { Sales commission } & 62,000 \\\hline \text { Supervisory salaries, production manager } & 66,000 \\\hline \text { Executive salaries } & 120,000 \\\hline \text { Raw material purchases } & 136,500 \\\hline \text { Miscellaneous plant supplies } & 13,700 \\\hline \text { Depreciation, office building } & 7,900 \\\hline \text { Depreciation, plant equipment } & 9,900 \\\hline \text { Property tax (80\% for office building; 20\% for plant building) } & 4,400 \\\hline \text { Sales } & 850,000 \\\hline \text { Direct labour } & 64,000 \\\hline \text { Raw material inventory, Dec } 31,2019 & 13,600 \\\hline \text { Utilities expense (60\% related to office) } & 19,000 \\\hline \text { General administrative expense } & 42,300 \\\hline\end{array}$$ At December 31, 2019, there was no work-in-process, but 30% of the units manufactured remained in ending finished goods inventory. Inventive uses the straight-line method to calculate depreciation.
Required:
a. Calculate the value of cost of goods sold and ending finished goods inventory under IFRS.
b. Prepare an income statement for Inventive for the year ended December 31, 2019.

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Definitions:

Origins

The point or place where something begins, arises, or is derived.

Nature

The inherent characteristics and genetic makeup of an organism, often contrasted with nurture, which involves environmental factors.

Nurture

The influence of external factors like environment, upbringing, and education on an individual's development.

Behaviorists

Psychologists who focus on observable behaviors and the ways in which they're learned.