The following information was taken from the accounting records of the Superior Company: Depreciation of equipment..............................................................................................
The following information was taken from the accounting records of the Superior Company:
|
Depreciation of equipment........................................................................................... |
$ 70,000 |
|
Direct labor........................................................................................... |
120,000 |
|
Factory taxes........................................................................................... |
2,000 |
|
Goods in process inventory, Dec. 31, 2019........................................................................................... |
250,000 |
|
Indirect labor........................................................................................... |
10,000 |
|
Power........................................................................................... |
16,000 |
|
Raw materials inventory, Dec. 31, 2019........................................................................................... |
60,000 |
|
Raw materials purchases, for year........................................................................................... |
230,000 |
|
Goods in process inventory, January 1, 2019........................................................................................... |
302,000 |
|
Raw materials inventory, January 1, 2019........................................................................................... |
110,000 |
Required:
Prepare a manufacturing statement for the Superior Company for 2019.
The following information was taken from the accounting records of the Superior Company:
|
Depreciation of equipment........................................................................................... |
$ 70,000 |
|
Direct labor........................................................................................... |
120,000 |
|
Factory taxes........................................................................................... |
2,000 |
|
Goods in process inventory, Dec. 31, 2019........................................................................................... |
250,000 |
|
Indirect labor........................................................................................... |
10,000 |
|
Power........................................................................................... |
16,000 |
|
Raw materials inventory, Dec. 31, 2019........................................................................................... |
60,000 |
|
Raw materials purchases, for year........................................................................................... |
230,000 |
|
Goods in process inventory, January 1, 2019........................................................................................... |
302,000 |
|
Raw materials inventory, January 1, 2019........................................................................................... |
110,000 |
Required:
1. Prepare a manufacturing statement for the Superior Company for 2019.
2. Explain the conceptual difference between total manufacturing costs and cost of goods manufactured. What does it mean?
3.The factory overhead account must be adjusted at the end of an accounting period. Explain why this adjustment is needed and the consequences to the financial statements if the adjustment is not made.
Homework Answers
| Superior Manufacturing Company | ||||
| Manufacturing Statement | ||||
| For the year ended Dec. 31, 2019 | ||||
| Direct Materials | ||||
| Raw material inventory - Jan 1, 2019 | 110,000 | |||
| Add: Raw material Purchased | 230,000 | |||
| Raw Material Available for Use | 340,000 | |||
| Less: Raw Material Inventory - Dec 31, 2019 | (60,000) | |||
| Direct material Used | 280,000 | |||
| Direct labor | 120,000 | |||
| Factory Overhead | ||||
| Indirect Labor | 10,000 | |||
| Power | 16,000 | |||
| Factory Taxes | 2,000 | |||
| Dep. On Equipments | 70,000 | |||
| Total Factory overheads | 98,000 | |||
| Total Manufacturing Costs | 498,000 | |||
| Add: Goods in Process - Jan 1, 2019 | 302,000 | |||
| Total Goods in process during the year | 800,000 | |||
| less: Goods in process - Dec 31, 2019 | (250,000) | |||
| Cost of Goods Manufactured | 550,000 | |||
Answer 2:
Total Manufacturing Costs = Direct Material + Direct Labor+ Factory or manufacturing Overheads
Cost of Goods Manufactured = Total Manufacturing Costs+ Beginning Inventory- Closing Inventory
Total Manufacturing Costs is a part of COGM.
Add Answer to:
The following information was taken from the accounting
records of the Superior Company:
Depreciation of
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Required information
[The following information applies to the questions
displayed below.]
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cans, had the following inventory balances at the beginning and end
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