Question

Manufacturing Income Statement, Statement of Cost of Goods Manufactured

Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies for the month of December.

	On Company		Off Company
Materials inventory, December 1	$60,270		$82,570
Materials inventory, December 31	(a)		93,300
Materials purchased	153,090		(a)
Cost of direct materials used in production	161,520		(b)
Direct labor	227,220		185,780
Factory overhead	70,520		92,480
Total manufacturing costs incurred in December	(b)		534,230
Total manufacturing costs	574,980		733,220
Work in process inventory, December 1	115,720		198,990
Work in process inventory, December 31	97,640		(c)
Cost of goods manufactured	(c)		529,270
Finished goods inventory, December 1	101,860		92,480
Finished goods inventory, December 31	106,680		(d)
Sales	888,380		825,700
Cost of goods sold	(d)		534,230
Gross profit	(e)		(e)
Operating expenses	115,720		(f)
Net income	(f)		183,310

Required:

1. Determine the amounts of the missing items, identifying them by letter. Enter all amounts as positive numbers.

Letter	On Company	Off Company
a.	$	$
b.	$	$
c.	$	$
d.	$	$
e.	$	$
f.	$	$

2. Prepare On Company's statement of cost of goods manufactured for December.

On Company
Statement of Cost of Goods Manufactured
For the Month Ended December 31
			$
Direct materials:
	$
	$
		$
Total manufacturing costs incurred during December
Total manufacturing costs			$
			$

3. Prepare On Company's income statement for December.

On Company
Income Statement
For the Month Ended December 31
		$
Cost of goods sold:
	$
	$
		$
		$

Answer 1

1)

	ON COMPANY			OFF COMPANY
a)	Materials inventory, December 1	$      60,270.00		Materials inventory, December 1	$    (82,570.00)
	Materials purchased	$    153,090.00		Cost of direct materials used in production	$    255,970.00
	Cost of direct materials used in production	$    161,520.00		Materials inventory, December 31	$      93,300.00
	Materials inventory, December 31	$      51,840.00		Materials purchased	$    266,700.00
b	Cost of direct materials used in production	$    161,520.00		Total manufacturing costs incurred in December	$    534,230.00
	Direct labor	$    227,220.00		Direct labor	$    185,780.00
	Factory overhead	$      70,520.00		Factory overhead	$      92,480.00
	Total manufacturing costs incurred in December	$    459,260.00		Cost of direct materials used in production	$    255,970.00
c	Total manufacturing costs incurred in December	$    459,260.00		Total manufacturing costs incurred in December	$    534,230.00
	Work in process inventory, December 1	$    115,720.00		Work in process inventory, December 1	$    198,990.00
	Work in process inventory, December 31	$    (97,640.00)		Cost of goods manufactured	$    529,270.00
	Cost of goods manufactured	$    477,340.00		Work in process inventory, December 31	$    203,950.00
d
	Cost of goods manufactured	$    477,340.00		Cost of goods manufactured	$    529,270.00
	Finished goods inventory, December 1	$    101,860.00		Finished goods inventory, December 1	$      92,480.00
	Finished goods inventory, December 31	$ (106,680.00)		Cost of goods sold	$    534,230.00
	Cost of goods sold	$    472,520.00		Finished goods inventory, December 31	$      87,520.00
e	Sales	$    888,380.00		Sales	$    825,700.00
	Cost of goods sold	$    472,520.00		Cost of goods sold	$    534,230.00
	Gross profit	$    415,860.00		Gross profit	$    291,470.00
f	Gross profit	$    415,860.00		Gross profit	$    291,470.00
	Operating expenses	$    115,720.00		Net Income	$    183,310.00
	Net Income	$    300,140.00		Operating Expenses	$    108,160.00

2)

On Company
Statement of Cost of Goods Manufactured
Work in Process Inventory, Dec 1		$ 115,720.00
Direct materials:
Materials Inventory, Dec 1	$    60,270.00
Purchases	$ 153,090.00
Cost of Materials available for use	$ 213,360.00
Less Materials Inventory, Dec 31	$    51,840.00
Cost of Direct Materials used in Production		$ 161,520.00
Direct Labor		$ 227,220.00
Factory Overhead		$    70,520.00
Total Manufacturing Costs incurred during December		$ 459,260.00
Total Manufacturing Costs		$ 574,980.00
Less Work in Process Inventory, Dec 31		$    97,640.00
Cost of Goods Manufactured		$ 477,340.00

3)

On Company
Income Statement
Sales		$ 888,380.00
Cost of Goods Sold:
Finished Goods Inventory, Dec 1	$ 101,860.00
Cost of Goods Manufactured	$ 477,340.00
Cost of Finished Goods Available for Sale	$ 579,200.00
Less Finished Goods Inventory, Dec 31	$ 106,680.00
Cost of Goods Sold		$ 472,520.00
Gross Profit		$ 415,860.00
Operating Expenses		$ 115,720.00
Net Income		$ 300,140.00