Valenko Company provided the following account balances for the year ended December raw materials are used in production as direct materials):
Selling expenses................$215,000
Purchases of raw materials............$260,000
Direct labor..................$?
Administrative expenses.............$160,000 Manufacturing overhead applied to work in process..$340,000
Total actual manufacturing overhead costs......$350,000
Inventory balances at the beginning and end of the year were as follows:

The total manufacturing costs for the year were $675,000; the cost of goods available for sale totaled $720,000; the unadjusted cost of goods sold totaled $665,000; and the net operating income was $35,000. The company's overapplied or under applied overhead is closed entirely to cost of goods sold.

Required:

Prepare schedules of cost of goods manufactured and cost of goods sold and an income statement.