Question

Consider the following account balances (in thousands) for the Peterson Company: (Click the icon to view the account balances.) Requirements 1. Prepare a schedule for the cost of goods manufactured for 2017. 2. Revenues for 2017 were $275 million. Prepare the income statement for 2017. Requirement 1. Prepare a schedule for the cost of goods manufactured for 2017 Begin by preparing the schedule of cost of goods manufactured (in thousands). Start with the direct materials and labor costs, then indirect manufacturing costs, and complete the schedule by calculating cost of goods manufactured. Peterson Company Schedule of Cost of Goods Manufactured For the Year Ended December 31, 2017 (in thousands) A Data Table - X Direct materials: Beginning of 2017 End of 2017 Peterson Company 29,000 26,000 25,000 10,000 21,000 24,000 71,000 Direct materials used Direct manufacturing labor Indirect manufacturing costs: 28,000 Direct materials inventory Work-in-process inventory Finished-goods inventory Purchases of direct materials Direct manufacturing labor Indirect manufacturing labor Plant insurance Depreciation-plant, building, and equipment Repairs and maintenance—plant Marketing, distribution, and customer-service costs General and administrative costs 15,000 9,000 18,000 3,000 108,000 20,000 Choose from any list or enter any number in the input fields and then continue to the next question.

Answer 1

1. Preparing Schedule for Cost of Goods Manufactured:-

Peterson Company

Schedule of Cost of Goods Manufactured

For the Year Ended December 31,2017

(In Thousands)

Items	Amount	Amount
Direct Materials:-
Direct Materials Inventory, Beginning	$26,000
Add:- Purchases of Direct Materials	71,000
	$97,000
Less:- Direct Materials Inventory, Ending	(29,000)
Direct Materials Used		$68,000
Add:- Direct Manufacturing Labor		$28,000
Indirect Manufacturing Cost:-
Indirect Manufacturing Labor	$15,000
Plant Insurance	9,000
Depreciation - Plant, Building and Equipment	18,000
Repairs and Maintenance - Plant	3,000
Total Indirect Manufacturing Cost		$45,000
Total Manufacturing Overhead		$141,000
Add:- Work in Process Inventory, Beginning		$25,000
		$166,000
Less:- Work in Process Inventory, Ending		(21,000)
Cost of Goods Manufactured		$145,000

2. Preparing Income Statement:-

Peterson Company

Income Statement

For the Year Ended December 31,2017

(In Thousands)

Accounts	Amount	Amount
Revenues		$275,000
Less:- Cost of Goods Sold
Cost of Goods Manufactured	$145,000
Add:- Finished Goods Inventory, Beginning	10,000
Cost of Goods Available	$155,000
Less:- Finished Goods Inventory, Ending	(24,000)
Cost of Goods Sold		$(131,000)
Gross Income		$144,000
Less:- Operating Costs
Marketing, Distribution and Customer Service Costs	$108,000
General and Administrative Costs	20,000
Total Operating Costs		$(128,000)
Net Income		$16,000