Question

P19-4B The following data were taken from the records of Goodman Manufacturing Company for the year ended December 31. 2012 $7.400 Raw Materials Factory Insurance Inventory 1/1/12 $47.000 Factory Machinery Raw Materials Depreciation Inventory 12/31/12 44.200 Factory Utilities Finished Goods Office Utilities Expense Inventory 1/1/12 85,000 Sales Finished Goods Sales Discounts Inventory 12/31/12 67,800 Plant Manager's Salary Work in Process Factory Property Taxes Inventory 1/1/12 9,500 Factory Repairs Work in Process Raw Materials Purchases Inventory 12/31/128,000 Cash Direct Labor 145.100 Indirect Labor 18,100 Accounts Receivable 27.000 7.700 12.900 8,600 465.000 2,500 40,000 6.100 800 62,500 28.000 Instructions (a) Prepare a cost of goods manufactured schedule. (Assume all raw materials used were direct materials.) (b) Prepare an income statement through gross profit. (c) Prepare the current assets section of the balance sheet at December 31.

Answer 1

a)

Schedule of Cost of goods sold

Direct materials:
Beginning raw material inventory	47,000
Add: Purchases of raw material	62,500
Total raw materials available	109,500
Less: Ending raw materials inventory	- 44,200
Raw materials used in production		65,300
Direct labor		145,100
Factory overheads:
Indirect labor	18,100
Factory utilities	12,900
Factory insurance	7,400
Factory machinery depreciation	7,700
Plant manager salary	40,000
Factory property taxes	6,100
Factory repairs	800
Total factory overhead		93,000
Total manufacturing cost		303,400
Add: Beginning work in process inventory		9,500
		312,900
Less: Ending work in process inventory		- 8,000
Cost of goods manufactured		$304,900

b)

Income statement

Sales	465,000
Sales discounts	- 2,500
Net sales		462,500
Cost of goods sold:
Finished goods, beginning	85,000
Cost of goods manufactured	304,900
Cost of goods available for sale	389,900
Finished goods, ending	- 67,800
Cost of goods sold		- 322,100
Gross profit		$140,400

c)

Balance sheet (partial)

Assets	Amount
Current assets
Cash	28,000
Accounts receivable	27,000
Inventory:
Raw material	44,200
Work in process	8,000
Finished goods	67,800

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