Consider the following account balances (in thousands) for the Peterson Company

Question

Consider the following account balances (in thousands) for the Peterson Company 1. Prepare a schedule for the cost of goods manutactured for 2017 2. Revenues for 2017 wene $310 million Prepare the income statement for 2017 (Cick the oon to view the account balances.) Requirement 1. Prepare a schedule for the cost of goods manufactured for 2017 Begin by preparing the schedule of cost of goods manufactured (in thousands). Start with the direct materials and labor costs, then indirect manufacturing costs, and complete the schedue by calculating cost of goods manufactured Peterson Company Schedule of Cost of Goods Manufactured For the Year Ended December 31, 2017 (in Direct materials Direct materials used Direct manufacturing labor Indirect manutacturing oosts: Total Indirect manufacturing costs Manufacturing costs incurred during 2017 Total costs to account for Cost of Requirement 2. Revenues for 2017 were $310 million. Prepare the income statement for 2017. (Use parentheses or a minus sign for operating losses) Peterson Company Income Statement For the Year Ended December 31, 2017 (in thousands) Cost of goods sold: Cost of goods sold Operating costs Total operating costs

Explanation / Answer

Solution 1:

Solution 2:

Peterson Company Schedule of cost of goods manufactured For the year ended December 31, 2017 (In thousands) Particulars Amount Direct materials: Beginning inventory $21,000.00 Add: Purchase of direct materials $74,000.00 Less: Ending inventory of direct material -$23,000.00 Direct material consumed $72,000.00 Direct manufacturing labor $22,000.00 Manufacturing overhead costs: Indirect manufacturing labor $17,000.00 Plant insurance $7,000.00 Depreciation - Plant, Building and equipment $11,000.00 Repairs and maintenance - Plant $3,000.00 Total manufacturing overhed costs $38,000.00 Manufacturing cost incurred during 2017 $132,000.00 Add: Beginning Work In Process Inventory $26,000.00 Total manufacturing costs to account for $158,000.00 Less: Ending work in process inventory -$25,000.00 Cost of goods manufactured $133,000.00

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