Question

Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials): $ 219,000 $ 269,000 Selling expenses Purchases of raw materials Direct labor Administrative expenses Manufacturing overhead applied to work in process Actual manufacturing overhead cost $ 151,000 $376,000 $ 359,000 Inventory balances at the beginning and end of the year were as follows: Raw materials Work in process Finished goods Beginning of End of Year Year $ 52,000 $ 38,000 ? $ 32,000 $ 32,000 ? The total manufacturing costs for the year were $690,000, the cost of goods available for sale totaled $735,000; the unadjusted cost < Prev 20 of 20 !!!

Answer 1

1.

SUPERIOR COMPANY
Income Statement
	$	$
Sales		1,051,000.00
Less: Cost of goods sold		643,000.00
Gross margin		408,000.00
Selling and administrative expenses:
Selling Expenses	219,000.00
Administrative Expense	151,000.00	370,000.00
Net operating income (Given)		38,000.00

2.

SUPERIOR COMPANY
Schedule of cost of goods sold
	$
Beginning Finished Goods	32,000.00
Add: Cost of goods manufactured	703,000.00
Cost of goods available for sale	735,000.00
Less: Ending Finished Goods	(75,000.00)
Unadjusted Cost of goods sold	660,000.00
Less: Over applied overhead ($359,000 ‒$376,000)	(17,000.00)
Adjusted Cost of goods sold	643,000.00

3.

SUPERIOR COMPANY
SCHEDULE OF COST OF GOODS MANUFACTURED
	$	$
Direct materials:
Beginning Raw materials inventory	52,000.00
Add: Raw materials purchases	269,000.00
Raw materials available for use	321,000.00
Less: Ending Raw materials inventory	(38,000.00)
Raw materials used in production		283,000.00
Direct labor (690,000-376,000-283,000)		31,000.00
Manufacturing Overhead applied to work in process		376,000.00
Total manufacturing costs (Given)		690,000.00
Add: Beginning Work in process inventory		45,000.00
Total cost of work in process		735,000.00
Less: Ending Work in process inventory		(32,000.00)
Cost of goods manufactured		703,000.00