Question

Manufacturing Income Statement, Statement of Cost of Goods Manufactured Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies for the month of December On Off Company Company Materials inventory, December 1 $86,200 $114,650 Materials inventory, December 31 129,550 Materials purchased 218,950 (a) Cost of direct materials used in production 231,020 Direct labor 324,970 257,960 Factory overhead 100,850 128,410 Total manufacturing costs incurred in December (b) 741,790 Total manufacturing costs 822,3401,018,100 Work in process inventory, December 1 165,500 276,310 Work in process inventory, December 31 139,640 Cost of goods manufactured (c) 734,910 Finished goods inventory, December 1 145,680 128,410 Finished goods inventory, December 31 152,570 (d) Sales 1,270,590 1,146,500 Cost of goods sold (d) 741,790 Gross profit (e) Operating expenses 165,500 Net income (f) 254,520

Answer 1

letter		On		Off
		Company		Company
a.		74,130		370,320
b.		656,840		355,420
c.		682,700		283,190
d.		675,810		121,530
e.		603,780		404,710
f.		438,280		150,190

2)	Cost of goods manufactured (On company)
	Work in process inventory,december 1							165,500
	Raw materials inventory,December 1					86,200
	materials purchased					218,950
	cost of raw materials available for use					305,150
	Raw materials inventory,December 31					74,130
	Cost of direct materials used in production						231,020
	Direct labor						324,970
	Factory overhead						100,850
	Total manufacturing cost incurred in December							656,840
	Total manufacturing cost							822,340
	work in process inventory ,December 31							139,640
	cost of goods manufactured							682,700

sales							1,279,590
Cost of goods sold
Finished goods inventory,December 1						145,680
cost of goods manufactured						682,700
cost of goods available for sale						828,380
Finished goods inventory,December 31						152,570
Cost of goods sold							675,810
Gross profit							603,780
less operating expense							165,500
net income							438,280

working notes

Cost of goods manufactured (Off company)
Work in process inventory,december 1							276,310
Raw materials inventory,December 1					114,650
materials purchased					370,320
cost of raw materials available for use					484,970
Raw materials inventory,December 31					129,550
Cost of direct materials used in production						355,420
Direct labor						257,960
Factory overhead						128,410
Total manufacturing cost incurred in December							741,790
Total manufacturing cost							1,018,100
work in process inventory ,December 31							283,190
cost of goods manufactured							734,910
Cost of goods sold
Finished goods inventory,December 1						128,410
cost of goods manufactured						734,910
cost of goods available for sale						863,320
Finished goods inventory,December 31						121,530
Cost of goods sold						741,790
income statement
sales						1,146,500
less cost of goods sold						741,790
Gross profit						404,710
less operating expense						150,190
net income						254,520