Selected data concerning operations of Cascade Manufacturing Company for the pas

Question

Selected data concerning operations of Cascade Manufacturing Company for the past fiscal year follow:

Raw materials used $600,000

Total manufacturing costs charged to production during the year (includes raw materials, direct labor, and manufacturing overhead applied at a rate of 60 percent of direct labor costs) 1,362,000

Cost of goods available for sale 1,507,000

Selling and general expenses 60,000 Inventories

Beginning Ending Raw materials $70,000 $80,000

Work-in-process 85,000 30,000

Finished goods 90,000 110,000

-What is cost of goods manufactured? (Please show equation)

-What is COGS?

Explanation / Answer

SOLUTION COST OF GOODS MANUFACTURED RAW MATERIAL 6,00,000 Add: Beginning Raw materials 70,000 LESS:Ending Raw materials 80,000 Add: Manufacturing Exp 817200 Add: opening WIP 85,000 LESS: Closing WIP 30,000 COST OF GOODS MANUFACTURED 14,62,200 COST OF GOOD SOLD Cost of goods manufactured 14,62,200 Add:Selling and general expenses 60,000 Add:Cost of goods available for sale 15,07,000 Add: Opening Finished goods   90,000 Less: Closing Finished goods   1,10,000 COST OF GOOD SOLD 30,09,200

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