Conrad, Inc. recently lost a portion of its records in an office fire. The follo
ID: 2493662 • Letter: C
Question
Conrad, Inc. recently lost a portion of its records in an office fire. The following information was salvaged from the accounting records.
Cost of Goods Sold $65,000
Work-in-Process Inventory, Beginning 10,500
Work-in-Process Inventory, Ending 9,000
Selling and Administrative Expense 15,000
Finished Goods Inventory, Ending 15,000
Finished Goods Inventory, Beginning ?
Direct Materials Used ?
Factory Overhead Applied 12,000
Operating Income 14,000
Direct Materials Inventory, Beginning 11,000
Direct Materials Inventory, Ending 6,000
Cost of Goods Manufactured 60,000
Direct labor cost incurred during the period amounted to 1.5 times the factory overhead. The CFO of Fisher, Inc. has asked you to recalculate the following accounts and to report to him by the end of the day. What is the amount of net sales?
Explanation / Answer
Net sales = Cost of sales + Operating Income
Cost Of sales = Cost of goods sold + Selling Expenses
Cost of goods sold = $65,000
Selling Expenses = $15,000
Operating Income = $14,000
therefore Cost of Sales = $65,000+$15,000 = $80,000
Net Sales = $80,000 + $14,000 = $94,000
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