Question

Glasson Manufacturing Co. produces only one product. You have obtained the following information from the corporation's books and records for the current year ended December 31, 2016:

a. Total manufacturing cost during the year was $1,000,000, including direct materials, direct labor, and factory overhead.

b. Cost of goods manufactured during the year was $970,000.

c. Factory Overhead charged to Work in Process was 75% of direct labor cost and 27% of the total manufacturing cost.

d. The beginning Work in Process inventory, in January 1, was 40% of the ending Work in Process inventory, on December 31.

e. Material purchases were $400.000 and the ending balance in   Materials inventory was $60,000. No indirect material were used in production.

Prepare a statement of cost of goods manufactured for the year ended December 31, for Glasson Manufacturing.

Answer 1

The answer has been presented in the supporting sheet. All the parts has been solved with detailed explanation and calculation. For detailed answer refer to the supporting sheet.

Answer Glasson Manufacturing Co. Statement of cost of goods manufactured 5 Direct Material Consumed Beginning inventory (430000-400000) 30000 Purchases 400000 Total goods available for sale 430000 Ending inventory O Direct material used (1000000-270000-360000) 1 Direct Labour (270000/75%) 60000 370000 360000 2 Manufacturing overheads (1000000*27%) 3 Total Manufacturing cost 4 Beginning work in process ((1000000-970000)/40%) 5 Total cost of goods available for manufacture 6 Less ending work in process (1000000-970000)/60%) 7 Cost of goods manufactured 270000 1000000 20000 1020000 50000 970000 9 For any help please comment in the comment box 20 Thank You