[The following information applies to the questionsdisplayed below.]

The following data is provided for Garcon Company and PepperCompany.

	Garcon Company					Pepper Company
Beginning finished goods inventory		$	12,300			$	17,800
Beginning work in process inventory			17,700				19,800
Beginning raw materials inventory			7,800				12,900
Rentalcost on factory equipment			33,250				26,800
Directlabor			20,200				37,800
Endingfinished goods inventory			17,900				16,800
Endingwork in process inventory			22,300				18,600
Endingraw materials inventory			5,800				9,600
Factoryutilities			10,650				14,000
Factorysupplies used			13,300				3,300
Generaland administrative expenses			23,500				50,500
Indirectlabor			1,350				9,580
Repairs—Factory equipment			4,820				3,650
Rawmaterials purchases			43,000				54,500
Sellingexpenses			58,400				56,200
Sales			217,530				345,010
Cash			23,000				22,700
Factoryequipment, net			222,500				121,825
Accountsreceivable, net			13,800				19,950

Required:
1-a. Prepare income statements for both GarconCompany and Pepper Company.
1-b. Prepare the current assets section of thebalance sheet for each company.

Prepare the income statement for Garcon Company.

REQ 1A:

	GARCON COMPANY Income Statement ForYear Ended December 31, 2017 Sales Less: Cost of goods sold Gross profit 0 Operating expenses Selling expenses General and administrativeexpenses Income (loss) beforetax $0

REQ 1A: Prepare the income statement for Pepper Company.

	PEPPER COMPANY Income Statement ForYear Ended December 31, 2017 0 Operating expenses Income (loss) beforetax $0

Prepare the current asset section of the balance sheet forGarcon Company.

REQ 1B:

	GARCON COMPANY Partial Balance Sheet As ofDecember 31, 2017 Cash Accounts receivable, net Inventories: Raw materials inventory Work in process inventory Finished goods inventory 0 Total current assets $0

Prepare the current asset section of the balance sheet forPepper Company.

REQ 1 B: Pepper

	PEPPER COMPANY Partial Balance Sheet As ofDecember 31, 2017 Inventories: 0 Total current assets $0