Question

Primare Corporation has provided the following data concerning last month's manufacturing operations. $ 30,000 $ 4,580 $ 59,200 $ 89,000 $ 4,150 Purchases of raw materials Indirect materials included in manufacturing overhead Direct labor Manufacturing overhead applied to work in process Underapplied overhead Inventories Beginning $ 10,600 $ 54,500 $ 34,100 Ending $ 19,000 $ 69,800 $ 43,000 Raw materials Work in process Finished goods Required: 1. Prepare a schedule of cost of goods manufactured for the month. 2. Prepare a schedule of cost of goods sold for the month. Assume the underapplied or overapplied overhead is closed to Cost of Goods Sold.

Answer 1

Solution:
1st	Primare Corporation
	Schedule of cost of goods manufactured
	Direct Materials:
	Beginning materials inventory	10,600
	Add: Purchases of raw materials	30,000
	Total raw materials available	40,600
	Less: Ending raw materials inventory	19,000
	Raw materials used in production	21,600
	Less: indirect materials included in manufacturing overhead incurred	4,580	17,020
	Direct Labor		59,200
	Manufacturing overhead applied to Work in Process		89,000
	Total manufacturing costs		165,220
	Add: Beginning work in process inventory		54,500
			219,720
	Less: Ending work in process inventory		69,800
	Cost of goods manufactured		149,920
Working Notes:
	Primare Corporation
	Schedule of cost of goods manufactured
	Direct Materials:
a	Beginning materials inventory	10,600
b	Add: Purchases of raw materials	30,000
c=a+b	Total raw materials available	40,600
d	Less: Ending raw materials inventory	19,000
e=c-d	Raw materials used in production	21,600
f	Less: indirect materials included in manufacturing overhead incurred	4,580	17,020	f=e-f
g	Direct Labor		59,200
h	Manufacturing overhead applied to Work in Process		89,000
	Total manufacturing costs		165,220	i=f+g+h
	Add: Beginning work in process inventory		54,500	j
			219,720	k=i+j
	Less: Ending work in process inventory		69,800	l
	Cost of goods manufactured		149,920	m=k-l
2nd	Primare Corporation
	Cost of goods sold
	Beginning finished goods inventory	34,100
	Add: Cost of goods manufactured	149,920
	Cost of goods available for sale	184,020
	Less: Ending finished goods inventory	43,000
	Unadjusted cost of goods sold	141,020
	Add: Underapplied overhead	4,150
	Adjusted cost of goods sold	145,170
Notes:
	Primare Corporation
	Cost of goods sold
a	Beginning finished goods inventory	34,100
b	Add: Cost of goods manufactured	149,920
c=a+b	Cost of goods available for sale	184,020
d	Less: Ending finished goods inventory	43,000
e=c-d	Unadjusted cost of goods sold	141,020
f	Add: Underapplied overhead	4,150
g=e+f	Adjusted cost of goods sold	145,170
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