Question

The following data (in thousands of dollars) have been taken from the accounting records of Karling Corporation for the just completed year.

	Sales..........................................................	$990
	Raw materials inventory, beginning.........	$40
	Raw materials inventory, ending...............	$70
	Purchases of raw materials........................	$120
	Direct labor................................................	$200
	Manufacturing overhead...........................	$220
	Administrative expenses...........................	$150
	Selling expenses........................................	$140
	Work in process inventory, beginning......	$70
	Work in process inventory, ending...........	$50
	Finished goods inventory, beginning........	$120
	Finished goods inventory, ending.............	$160

a.         The cost of goods manufactured (finished) for the year (in thousands of dollars) was:

b.         The cost of goods sold for the year (in thousands of dollars) was:

c.         The net operating income for the year (in thousands of dollars) was

Answer 1

a.

schedule of cost of goods manufactured

Raw materials inventory, beginning	40
Purchases of raw materials	120
Total raw material available	160
Raw materials inventory, ending	-70
Direct material used	90
Direct labor	200
Manufacturing overhead	220
Total manufacturing cost	510
Work in process inventory, beginning	70
Work in process inventory, ending	-50
Cost of goods manufactured	$530

b.

Schedule of cost of goods sold

Finished goods inventory, beginning	120
Cost of goods manufactured	530
Cost of goods sold available for sale	650
Finished goods inventory, ending	-160
Cost of goods sold	$490

c.

Income statement

Sales	990
Cost of goods sold	-490
Gross profit	500
Administrative expenses	-150
Selling expense	-140
Net operating income	$210

		(in thousands of dollars)
a	Cost of goods manufactured	$530
b	Cost of goods sold	$490
c	Net operating income	$210

kindly give a positive rating if you are satisfied with the solution. do comment if you have any query, Thanks.