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Happy Trails has this information for its manufacturing:

 Direct Materials $15 Direct labor $15 Variable manufacturing overhead $3 Fixed manufacturing overhead $25 Units produced 27,000 Units sold 19,000\begin{array}{lr} \text { Direct Materials } & \$ 15 \\ \text { Direct labor } & \$ 15 \\ \text { Variable manufacturing overhead } & \$ 3 \\ \text { Fixed manufacturing overhead } & \$ 25 \\ \text { Units produced } & 27,000 \\ \text { Units sold } & 19,000 \end{array}

Its income statement under absorption costing is:

 Sales $1,900,500 Beginning Inventory 0 Cost of Goods Manufactured 1,566,000 Cost of Goods Available for Sale 1,566,000 - Ending Inventory 464,000 Cost of Goods Sold 1,102,000 Gross Profit 798,500 - Sales and Administration Expenses  Variable 133,0000 Fixed 300,00 Total Sales and Administration Expenses 433,0000 Net Operating Income $365,50\begin{array}{lr} \text { Sales } & \$ 1,900,500 \\ \text { Beginning Inventory } & 0 \\ \text { Cost of Goods Manufactured } & 1,566,000 \\ \text { Cost of Goods Available for Sale } & 1,566,000 \\ \text { - Ending Inventory } & 464,000 \\ \text { Cost of Goods Sold } & 1,102,000 \\ \text { Gross Profit } & 798,500 \\ \text { - Sales and Administration Expenses } & \\ \text { Variable } & 133,0000 \\ \text { Fixed } &300,00 \\ \text { Total Sales and Administration Expenses } & 433,000 0 \\ \text { Net Operating Income }&\$ 365,50 \end{array}

Prepare an income statement with variable costing and a reconciliation statement between both methods.

Question

Identify and correct all errors in semicolons and colons. Write the word immediately preceding the semicolon or colon that needs to be added or deleted.

Example: The Bill of Rights does not gather dust, in fact, it continues to be tested: to this day.

Answer: dust; tested

In his first inaugural address, Abraham Lincoln stated the following "While the people retain their virtue and vigilance, no administration . . can very seriously injure the government in the short space of four years."

Solution

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We need to distinguish and correct faults in semicolon and colon use.

Since this sentence has a long and formal quotation, we need to precede it with a colon. We should put it right at the end of the introductory phrase.

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