The following data was taken from the general ledger and other records of XYZ Ma

Question

The following data was taken from the general ledger and other records of XYZ Manufacturing Co. at July 31, the end of the first month of operations in the current fiscal vear $50,000 15,000 20,000 28,000 21,000 12,500 Sales Materials inventory (July 1) Work in process inventory (July 1) Finished goods inventory (July 1) Materials purchased Direct labor cost Factory overhead (including $5,000 of indirect materials used and $2,500 of indirect labor cost) Selling and administrative expense Inventories at July 31 Materials Work in process Finished goods 11,500 8,000 16,000 18,000 30,000 Prepare a statement of cost of goods manufactured. Determine the cost of goods sold for the month. a.

Explanation / Answer

Solution:

a) Preparing a Statement of Cost of Goods Manufactured:

XYZ Manufacturing Co.

Statement of Cost of Goods Manufactured

For the Month Ended July 31

b) Determining the Cost of Goods Sold for the Month:

XYZ Manufacturing Co.

Statement of Cost of Goods Sold

For the Month Ended July 31

XYZ Manufacturing Co.

Statement of Cost of Goods Manufactured

For the Month Ended July 31

Direct Materials: Inventory, July 1 $15,000 Purchases $21,000 Total cost of available materials $36,000 Less: Inventory, July 31 $16,000 Cost of materials used $20,000 Less: Indirect materials used $5,000 Cost of direct materials used in production $15,000 Direct labor $12,500 Factory overhead: Indirect materials $5,000 Indirect labor $2,500 Other $4,000 Total factory overhead $11,500 Total manufacturing cost $39,000 Add: work in process inventory, July 1 $20,000 Total $59,000 Less: work in process inventory, July 31 $18,000 Cost of goods manufactured during the month $41,000

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