Question

StorSmart Company makes plastic organizing bins. The company has the following inventory balances at the beginning and end of March Beginning Inventory Ending Inventory Raw materials Work in process Finished goods $28,700 21,300 79,200 $25,900 46,900 69,800 Additional information for the month of March follows StorSmart Company makes plastic organizing bins. The company has the following inventory balances at the beginning and end of March Raw materials purchases Indirect materials used Direct labor Manufacturing overhead applied Selling, general, and administrative expenses Sales revenue $ 41,300 1,500 63,600 35,400 23,400 236,200 Required 1. Based on the above information, prepare a cost of goods manufactured report. STORSMART COMPANY Cost of Goods Manufactured Report For the Month of March Direct Materials Used in Production Total Current Manufacturing Costs Total Work in Process Cost of Goods Manufactured

Answer 1

Solution:

1.)

STORSMART COMPANY
Cost of Goods Manufactured Report
For the Month of March
Beginning raw material	$28,700
Add: Purchase of raw material	$41,300
Total raw material available	$70,000
Less: Ending raw material	($25,900)
Raw material used	$44,100
Less: Indirect material used	($1,500)
Direct material used	$42,600
Direct labor	$63,600
Manufacturing overhead	$35,400
Total manufacturing cost	$141,600
Beginning work in progress	$21,300
Less: Ending work in process	($46,900)
Cost of goods manufactured	$116,000

2.

STORSMART COMPANY
Income Statement
For the Month of March
Sales Revenue		$236,200
Less: Cost of goods sold
Beginning finished goods inventory	$79,200
Add: Cost of goods manufactured	$116,000
Total goods available for sale	$195,200
Less: Ending finished goods inventory	($69,800)
Cost of goods sold		($125,400)
Gross Profit		$110,800
Less: Operating Expenses
Selling and Administrative Expenses		($23,400)
Net Income from Operations		$87,400