Rooney Manufacturing Company began operations on January 1. During the year, it

Question

Rooney Manufacturing Company began operations on January 1. During the year, it started and completed 1,610 units of product. The financial statements are prepared in accordance with GAAP. The company incurred the following costs: 1. Raw materials purchased and used $3,110. 2. Wages of production workers$3,520. 3. Salaries of administrative and sales personnel–$1,945. 4. Depreciation on manufacturing equipment —$4,640. 5. Depreciation on administrative equipment –$1,780. Rooney sold 1,110 units of product. Required a. Determine the total product cost for the year. b. Determine the total cost of the ending inventory. (Do not round intermediate calculations.) c. Determine the total of cost of goods sold. (Do not round intermediate calculations.) Total product cost Total cost of ending inventory Total cost of goods sold

Explanation / Answer

a Total product cost Amount in$ Raw materials purchased and used 3110 Wages of production workers 3520 Depreciation on manufacturing equipment 4640 Product cost 11270 b Total cost of the ending inventory Unit produced 1610 Unit sold -1110 Ending inventory 500 Cost of the ending inventory 3500 (11270 * 500/1610) c Cost of goods sold 7770 (11270*1100/1610) or Cost of goods sold Product cost 11270 Less: Cost of ending inventory -3500 Cost of goods sold 7770

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