Question

Cost of Goods Sold Budget Daybook Inc. budgeted production of 403,500 personal journals in 2016. Paper is required to produce a journal. Assume six square yards of paper are required for each journal. The estimated January 1, 2016, paper inventory is 40,400 square yards. The desired December 31, 2016, paper inventory is 38,900 square yards. Paper costs $0.40 per square Yard Each journal requires assembly. Assume that eight minutes are required to assemble each journal. Assembly labor costs $13.00 per hour. Prepare a cost of goods sold budget for Daybook Inc. using the information above. Assume the estimated inventories on January 1, 2076, for finished goods and work in process were $28,000 and 516,500, respe y. Also assume the desired inventories on December 31, 2016, for finished goods and work in process were $30,000 and $14,300 Factory overhead was budgeted at $214,600. Round your interim calculations to nearest cent, if required DAYBOOK INC. Cost of Goods Sold Budget For the Year Ending December 31, 2 Direct materials: Cost of direct materials placed in productions

Answer 1

Solution: 28000 16500 DAYBOOK INC. cost of goods sold budget For the month ending Dec 31, 2046 Finished goods inventory, January 1, 2016 Work in process inventory, January 1, 2046 Direct material: Direct matrial inventory, January 1, 20Y6=40400*0.4 Direct material purchases=983960-16160 cost of direct material available for use=968400+15560 Less : Direct matrial inventory, December 31, 20Y6=38900*0.4 cost of direct material placed in production=403500*6*0.4 Direct labor=403500*(8/60)*13 factory overhead Total manufacturing costs Total work in process during the period Total work in process inventory, Jan 30 cost of goods manufactured cost of finished goods available for sale Finished goods inventory, December 31, 2016 cost of goods sold 16160 967800 9 83960 15560 968400 699400 214600 1882400 1898900 14300 1884600 1912600 30000 1882600