DATA INPUT
Accounting Records:
Raw materials purchases 350,000$
Direct Labor 508,000
Indirect labor 218,000
Selling and administration salaries 266,000
Building depreciation 160,000
Other selling and administration expenses 380,000
Other factory costs 688,000
Sales revenue 2,990,000
Sales price 260
Building devoted to production 75%
Building devoted to selling and admin 25%
Inventory data: January 1 December 31
Raw materials 31,600$ 36,400$
Work in process 71,400 124,200
Finished goods 222,200 195,800
Units in finished goods 1,350 1,190
Tax rate 40%
SOLUTION
1. Manufacturing overhead:
2. Cost of goods manufactured:
Direct material:
Raw material inventory, Jan. 1 31,600$
3. Cost of good sold:
Finished-goods inventory, Jan. 1 222,200$
Add: Cost of goods manufactured 1,826,400
4. Net income:
Sales revenue 2,990,000$
Less: Cost of goods sold 1,852,800