The following data have been taken from the accounting records of Larder Corpora
ID: 2387679 • Letter: T
Question
The following data have been taken from the accounting records of Larder Corporation for the just completed year.Sales.......................................$2,000,000
Purchases of raw materials...........$350,000
Direct labor................................$445,000
Manufacturing overhead..............$475,000
Administrative expenses..............$350,000
Selling expenses........................$385,000
Raw materials inventory, beginning $300,000
Raw materials inventory, ending ....$320,000
Work in process inven, beginning....$100,000
Work in process inven, ending.........$80,000
Finished goods inven, beginning......$90,000
Finished goods inven, beginning......$300,000
a) Prepare a Schedule of Cost of Goods Manufactured in good form.
b) Compute the Cost of Goods Sold
c) Using data from your answers above, prepare an Income Statement.
Please help me!! thanks!!
Explanation / Answer
a) Prepare a Schedule of Cost of Goods Manufactured in good form.
Direct materials:
Raw materials inventory, beginning ........................... $300,000
Add: Purchases of raw materials ................................ $350,000
Raw materials available for use ................................. $650,000
Deduct: Raw materials inventory, ending .................. 320,000
Raw materials used in production ................................. $330,000
Direct labor .................................................................... $445,000
Manufacturing overhead ................................................ $475,000
Total manufacturing cost ............................................... $1250,000
Add: Work in process inventory, beginning. ................ ....$100,000 =1350,000
Deduct: Work in process inventory, ending .................. $80,000
Cost of goods manufactured .......................................... $128000
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2 .Computation of cost of goods sold
Finished goods inventory, beginning .............................. $90,000
Add: Cost of goods manufactured ................................... $1280000
Goods available for sale .................................................. $1370000
Deduct: Finished goods inventory, ending ...................... $320,000
Cost of goods sold ........................................................... $105000
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