Question

As of February 1, 2020, Custom Cabinets had the following balances in its inventory accounts: Materials Inventory $28,400 Work in Process Inventory $36,700 Finished Goods Inventory $14,000 4 The following events took place for during February, 2020 Purchased $120,000 of materials Used $125,700 of direct materials in production. Incurred $194,400 of direct labor wages Applied $105,200 of factory overhead. Transferred $391,600 of work in process to finished goods. Sold goods with a cost of $240,500. Sold goods for $475,800 Incurred $125,100 of selling expenses. Incurred $78,000 of administrative expenses. Using the information given, calculate the following: (journal entries are NOT required, simply calculate the following)

Answer 1

1) 3) Beginning inventory of raw materials Add: Raw materials purchased Less: Raw materials used in the production Cost of ending raw materials inventory $28,400 $120,000 $125,700 $22,700 Cost of goods transferred to finished goods Add: Cost of beginning finished goods Less: Cost of Goods Sold Cost of ending finished goods inventory $391,600 $14,000 $240,500 $165,100 2) 4) & 5) $475,800 $240,500 $235,300 [$475800 - $240500] Direct materials used Direct labor cost Mfg. overhead applied Total mfg. costs incurred Add: Cost of beginning work in process Less: Cost of goods trfd. to finished goods Cost of ending work in process inventory $125,700 $194,400 $105,200 $425,300 $36,700 -$391,600 $70,400 Sales Revenue Less: Cost of Goods Sold 4) Gross Profit Selling and Administrative Expenses: Selling Expenses $125,100 Administrative Expenses $78,000 Total Selling and Administrative Expenses 5) Net Income $203,100 ($125100 + $78000] $32,200 [$235300 - $203100]