01: The ABc Company specializes in producing a set of wooden chairs. The chairs
ID: 2573112 • Letter: 0
Question
01: The ABc Company specializes in producing a set of wooden chairs. The chairs enjoys great popularity, and the company has ample arders to keep production going at its full capacity of 2,000 chairs per year Annual cost data at full capacity follow Factory labor, direct Fited GttAdvertising $50,000 Property taxes, factory building Sales $5,000 10, Lease cost factory equipment $5,000 $5,000 S5.000 $50,000 $100,000 $25,000 factory building Administrativeoffice supplies (billing) Administrative office salaries Purchases of raw materials Ve Sales Raw Material Beginning Raw Material End WIP Beginning WIP End Finished Goods Beginning Finished Goods End $55,000 $o $0 $25,000 $25,000 $15,000 a. Find the cost of manufactured b. Prepare the Income StatementExplanation / Answer
cost of goods sold :Beginning Finished goods+cost of goods manufactured-ending FG
= 25000+360000-15000
= 370000
Statement of cost of goods manufactured Raw Material at beginning 55000 Purchase of raw material 100000 Raw material at end (0) Raw material used in production 155000 Factory labor-direct 120000 overhead Factory supervision 50000 property taxes -factory building 5000 Insurance -factory 5000 lease cost-factory 15000 Indirect material-factory 5000 depreciation -factory 5000 utilites factory 25000 Total overhead 110000 Total manufacturing cost 385000 Add:Beginning WIP 0 lESs:ending WIP (25000) Cost of goods manufactured 360000Related Questions
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