First Class, Inc., expects to sell 30 comma 00030,000 pool cues for $ 13.00$13.0

ID: 2589662 • Letter: F

Question

First Class, Inc., expects to sell

30 comma 00030,000

pool cues for

$ 13.00$13.00

each. Direct materials costs are

$ 2.00$2.00,

direct manufacturing labor is

$ 6.00$6.00,

and manufacturing overhead is

$ 0.86$0.86

per pool cue. The following inventory levels apply to 2019:

Beginning inventory

Ending inventory

Direct materials

30 comma 00030,000 units

Workminusinminusprocess

0 units

Finished goods inventory

1 comma 7001,700 units

2 comma 7002,700 units

On the 2019 budgeted income statement, what amount will be reported for cost of goods sold?

Beginning inventory

Ending inventory

Direct materials

30 comma 00030,000 units

Workminusinminusprocess

inventory

0 units

Finished goods inventory

1 comma 7001,700 units

2 comma 7002,700 units

Company Expect to sell in 2019 = 30,000 units

Cost per unit = Direct materials costs + Direct manufacturing labor + Manufacturing overhead

= $2.00 + $6.00 + $0.86 = $8.86 per unit

2019 budgeted cost of goods sold =Expected sales in units * Cost per unit

= 30,000 units *$8.86 per unit = $265,800

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