220)
Compute the ending work in process inventory for a manufacturer with the following information.
Raw materials purchased
131,700
Raw materials used in production
65,400
Direct labor used
44,000
Total factory overhead used
101,600
Work in process inventory, beginning of year
32,500
Cost of goods manufactured
212,900
221)
The following items for Neptune Company are used to compute the cost of goods manufactured
and the cost of goods sold. Indicate how each item should be used in the calculations by filling in
the blanks with “+” if the item is to be added, “-” if the item is to be subtracted, or “0” if the item is
not used in the calculation. The first item is completed as an example.
Cost of Goods
Cost of Goods
Manufactured
Sold
Beginning finished goods inventory
0
________+___
_____
Ending finished goods inventory
________
________
Direct labor
________
________
Indirect labor
________
________
Beginning work in process inventory
________
________
Ending work in process inventory
________
________
General and administrative expenses
________
________
Indirect materials
________
________
Beginning raw materials inventory
________
________
Ending raw materials inventory
________
________
Raw material purchases
________
________
Depreciation of factory building
________
________
Cost of goods manufactured 176
________
________
Cost of goods manufactured
________
________
222)
Information for Stanton, Inc., as of December 31 follows. Prepare a schedule of cost of goods
manufactured for the year ended December 31.
Administrative salaries
$ 35,000
Depreciation of factory equipment
25,000
Depreciation of delivery vehicles
6,000
Direct labor
68,000
Factory supplies used
9,000
Finished goods inventory, January 1
57,000
Finished goods inventory, December 31
?
Factory insurance
15,500
Interest expense
12,000
Factory utilities
14,000
Factory maintenance
7,500
Raw materials inventory, January 1
5,000
Raw materials inventory, December 31
4,000
Raw material purchases 177
125,000
Raw material purchases
125,000
Rent on factory building
25,000
Repairs of factory equipment
11,500
Sales commissions
37,500
Work in Process inventory, January 1
3,500
Work in Process inventory, December 31
2,700
223)
Information for the Deuce Manufacturing Company follows. Compute the cost of goods
manufactured for this company.
Beginning raw materials inventory
$ 53,200
Beginning work in process, inventory
78,400
Ending raw materials inventory
58,100
Ending work in process, inventory
98,000
Direct labor
149,800
Total factory overhead
105,000
Raw material purchases
210,000
224)
Information for Jersey Metalworks as of December 31 follows. Prepare (a) the company’s schedule
of cost of goods manufactured for the year ended December 31; (b) prepare the company’s income
statement that reports separate categories for selling and general and administrative expenses.
Administrative salaries expense
$ 135,000
Depreciation expense–Factory equipment
52,400
Depreciation expense–Delivery vehicles
36,200
Depreciation expense–Office equipment
24,800
Advertising expense 179
22,350
Advertising expense
22,350
Direct labor
268,000
Factory supplies used
12,000
Income taxes expense
91,500
Indirect labor
35,000
Indirect material
24,000
Factory insurance
15,500
Factory utilities
14,000
Factory maintenance
7,500
Inventories
Raw materials inventory, January 1
32,000
Raw materials inventory, December 31
28,000
Work in Process inventory, January 1
33,780
Work in Process inventory, December 31
37,460
Finished goods inventory, January 1
56,970
Finished goods inventory, December 31
62,000
Raw materials purchases
325,000
Rent expense–Factory
50,000
Rent expense–Office space
24,000
Rent expense–Selling Space
24,000
Sales salaries expense
97,500
Sales
1,452,000
Sales discounts
29,000
225)
Martinez Company makes leather cowboy hats. Each hat requires ½ yard of leather to produce. On
December 31, 2014, the company had (a) 75 hats in Finished Goods Inventory and (b) 60 yards of
leather at a cost of $12 per yard in Raw Materials Inventory. During 2015, the company purchased
850 more yards of leather at $12 per yard and manufactured 1,600 hats. Determine the unit and
dollar amounts of Raw Materials Inventory in leather at December 31, 2015.
SHORT ANSWER QUESTIONS
226)
________ is an activity that provides financial and nonfinancial information to an organization’s
managers and other internal decision makers.
227)
________ is the process of setting goals and making plans to achieve them.
228)
________ is the process of monitoring planning decisions and evaluating an organization’s
activities and employees.
229)
The purpose of managerial accounting information is to help ________ users make decisions while
the purpose of financial accounting is to help ________ users make decisions.
230)
A system means that a company acquires or produces inventory only when needed.
231)
The model whose goal is to eliminate waste while satisfying the customer and providing a positive
return to the company is the ________.
232)
________ rejects the notions of “good enough” or “acceptable” and challenges employees and
managers to continuously experiment with new and improved business practices.
233)
The ________ aids continuous improvement by augmenting financial measures with information
on the drivers or indicators of future financial performance along four dimensions: (1) financial, (2)
customer, (3) internal business processes, and (4) learning and growth.
234)
is the deliberate misuse of the employer’s assets for the employee’s personal gain.
235)
Policies and procedures used by management to monitor and control business activities are known
as ________.
236)
________ are beliefs that distinguish right from wrong.
237)
The process of identifying costs as direct or indirect is referred to as classifying costs by .
238)
A ________ cost changes in total in proportion to changes in the volume of activity.
239)
A ________ cost does not change in total in proportion to changes in the volume of activity within
the relevant range.
240)
Expenditures necessary and integral to the manufacture of finished products are ________ costs.
241)
Expenditures that flow directly to the current income statement and are not reported as assets are
________ costs.
242)
________ inventory consists of goods a company acquires to use in making products.
243)
________ inventory consists of products in the process of being manufactured but not yet
complete.
244)
________ inventory consists of completed products ready for sale by a manufacturer.
245)
A manufacturer‘s inventory that is not completely finished is called _ .
246)
One of the main differences between the calculation of cost of goods sold for a merchandiser and
that of a manufacturer is that the calculation includes cost of goods purchased for the
merchandiser, but the manufacturer replaces that with ________.
247)
reveals how much raw materials inventory is available in terms of the number of days’
sales.
248)
________ reveals how many times a company uses its raw materials inventory in production
during a period.
249)
Expenditures incurred in the process of converting raw materials to finished goods, that include
direct labor and factory overhead are known as .
250)
Expenditures directly associated with the manufacture of finished goods that include direct
materials and direct labor, are costs.
251)
Crane, Inc. reported the following data regarding costs and inventories for the current year:
beginning goods–in-process inventory, $4,000; beginning finished goods inventory, $2,000; cost of
goods manufactured, $11,500; operating expenses, $3,000; ending finished goods inventory,
$1,000; ending goods–in–process inventory, $1,500. Cost of goods sold for Crane, Inc. equals
________.
252)
Waters, Inc. reported the following data regarding costs and inventories for the current year:
beginning finished goods inventory, $5,000; cost of goods manufactured, $21,500; ending finished
goods inventory, $4,000. Cost of goods sold for Waters, Inc. equals ________.
253)
For a manufacturer, the cost of goods sold can be computed by adding the beginning finished
goods inventory to ________ and then subtracting the ending finished goods inventory.