Question

At May 31, 2017, the accounts of Lopez Company show the following. 1. May 1 inventories—finished goods $14,300, work in process $17,400, and raw materials $8,800. 2. May 31 inventories—finished goods $9,900, work in process $16,000, and raw materials $7,500. 3. Debit postings to work in process were direct materials $64,700, direct labor $50,400, and manufacturing overhead applied $42,500. 4. Sales revenue totaled $216,000.

Prepare a condensed cost of goods manufactured schedule. Prepare an income statement for May through gross profit. Indicate the balance sheet presentation of the manufacturing inventories at May 31, 2017. please include all answers and calculations thank you

Answer 1

1) Cost of goods manfactured schedule
Lopez Company
Cost of goods manfactured
For the month ended May 31,2017
Work in process may 1				$    17,400.00
Direct materials used		$    64,700.00
Direct labour		$    50,400.00
Manfacturing overhead applied		$    42,500.00
Total manfacturing cost				$ 157,600.00
Total cost of work in process				$ 175,000.00
Less : work in process may 31				$ (16,000.00)
Cost of goods manfactured.				$ 159,000.00
2) Income statement for may through gross profit
Lopez Company
Income statement
For the month ended May 31,2017
Sales				$ 216,000.00
Cost of goods sold :
Finished goods, May 1		$    14,300.00
Cost of good manfactured		$ 159,000.00
Cost of goods available for sale		$ 173,300.00
Less : Finished goods may 31		$    (9,900.00)
Cost of goods sold :				$ 163,400.00
Gross profit				$    52,600.00
3) Balance sheet
Lopez Company
Balance sheet
For the month ended May 31,2017
Assets				Amount
Current assets
Inventory :
Finished goods	$    9,900.00
Work in process	$ 16,000.00
Raw materials	$    7,500.00
Total inventories				$    33,400.00