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	$	29,800		$	25,600
Work in process		21,900			46,000
Finished goods		78,500			68,800

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	$	41,700
Indirect materials used		1,200
Direct labor		62,900
Manufacturing overhead applied		35,900
Selling, general, and administrative expenses		23,100
Sales revenue		237,400

Required:
1. Based on the above information, prepare a cost of goods manufactured report.

2. Based on the above information, prepare an income statement for the month of March.

StorSmart Company makes plastic organizing bins. The company has the following inventory balances at the beginning and end of March:

Answer 1

1) Prepaid cost of goods manufactured report

Direct materials
Beginning raw material	29800
Raw material purchase	41700
Total material available	71500
Less: Ending raw material	-25600
Raw material used	45900
Less: Indirect material used	-1200
Direct material used		44700
Direct labor		62900
Manufacturing overhead applied		35900
Total manufacturing cost		143500
Beginning Work in process		21900
Total Cost of work in process		165400
Less: Ending work in process		-46000
Cost of goods manufactured		119400

Income statement

Sales		237400
Cost of goods sold
Beginning finished goods	78500
Cost of goods manufactured	119400
Cost of goods available for sale	197900
Less: Ending finished goods	-68800
Cost of goods sold		129100
Gross profit		108300
Selling, general, and administrative expenses		-23100
Net operating income		85200