Question

Westlake, Inc. produces metal fittings for the aerospace industry. The administrative and manufacturing operations occupy the same 200,000 square foot building. The manufacturing plant uses 150,000 square feet. Depreciation is assigned based on building use. Indirect labor represents 15 percent of the total manufacturing plant labor.

The financial information for the year just ended is shown as follows.

.

$ 30e 680 (Thousands of dollars) Administrative costs Total building depreciation Direct materials inventory, January 1 Direct materials inventory, December 31 Direct materials purchased during the year Finished goods inventory, December 31 Indirect labor Maintenance on plant machinery Marketing costs Operating profit Other plant overhead Plant supervision and administration Plant supplies and indirect materials Sales revenue Taxes on manufacturing property Work-in-process inventory, January 1 Work-in-process inventory, December 31 34 1,584 94 264 154 134 908 169 6,400 131 124

1. Prepare a cost of goods manufactured and sold statement.

There are mistakes in this answer, so I need the full right solution with details.

Answer 1

Schedule of Cost of Goods Manufactured
Beginning work in process , January 1		94
Manufacturing costs
Beginning direct material inventory, January 1	29
Add: Direct Material purchased	1,584
Direct Materials available for use	1,613
Less:Ending direct material inventory, December 31	34
Direct Materials used in production		1,579
Direct Labor		1,496
Manufacturing overhead
Indirect Labor	264
Depreciation on plant	510
Maintenance on plant machinery	154
Plant supervision and administration	169
Plant supplies and indirect materials	81
Taxes on manufacturing property	131
Other plant overhead	97
Total overhead		1,406
Total Manufacturing Costs		4,481
Total cost of work in process during the year		4,575
Less: Ending Work in Process, December 31		124
Cost of Goods Manufactured this year		4,451
Add: Beginning finished goods,January 1		531
Cost of goods sold available for sale		4,982
Less: Ending finished goods,December 31		94
Cost of goods sold		4,888
Income statement
Sales revenue		6400
Less: Cost of goods sold		4,888
Gross Margin		1,512
Administrative costs	300
Depreciation on office building	170
Marketing costs	134
Total operating costs		604
Operating profit		908

Workings:
Depreciation Allocation
Total Depreciation value /Total Square feet * Each Unit (plant) Square feet
Note: Calculation simplified for Thousand Dollars as per in Question
Plant = 680*150/200 = 510
Office = 680*50/200 = 170
Direct labor = Indirect labor*100/Indirect labor percentage - indirect labor
Direct Labor = 264*100/15 - 264 = 1496

Beginning finished Goods inventory
Sales Revenue		6400
Add: Ending finished goods inventory		94
Total		6494
Less: Cost of Goods Manufactured this year		4,451
Less: Total operating costs
Administrative costs	300
Depreciation on office building	170
Marketing costs	134
Total operating costs		604
less: Operating profit		908
Beginning finished Goods inventory		531

FORMULA:

5	G	H	I
6	Schedule of Cost of Goods Manufactured
7	Beginning work in process , January 1		94
8	Manufacturing costs
9	Beginning direct material inventory, January 1	29
10	Add: Direct Material purchased	1584
11	Direct Materials available for use	=SUM(H9:H10)
12	Less:Ending direct material inventory, December 31	34
13	Direct Materials used in production		=H11-H12
14	Direct Labor		1496
15	Manufacturing overhead
16	Indirect Labor	264
17	Depreciation on plant	510
18	Maintenance on plant machinery	154
19	Plant supervision and administration	169
20	Plant supplies and indirect materials	81
21	Taxes on manufacturing property	131
22	Other plant overhead	97
23
24	Total overhead		=SUM(H16:H22)
25	Total Manufacturing Costs		=SUM(I8:I24)
26	Total cost of work in process during the year		=I25+I7
27	Less: Ending Work in Process, December 31		124
28	Cost of Goods Manufactured this year		=I26-I27
29	Add: Beginning finished goods,January 1		531
30	Cost of goods sold available for sale		=SUM(I28:I29)
31	Less: Ending finished goods,December 31		94
32	Cost of goods sold		=+I30-I31
33
34	Income statement
35	Sales revenue		6400
36	Less: Cost of goods sold		=+I32
37	Gross Margin		=I35-I36
38
39	Administrative costs	300
40	Depreciation on office building	170
41	Marketing costs	134
42
43	Total operating costs		=SUM(H39:H41)
44
45	Operating profit		=I37-I43
46
47	Workings:
48
49	Depreciation Allocation
50	Total Depreciation value /Total Square feet * Each Unit (plant) Squre feet
51	Note: Calculation simplied for Thousand Dollars as per in Question
52	Plant = 680*150/200 = 510
53
54	Office = 680*50/200 = 170
55
56	Direct labor = Indirect labor*100/Indirect labor percentage - indirect labor
57	Direct Labor = 264*100/15 - 264 = 1496
58
59	Beginning finished Goods inventory
60	Sales Revenue		6400
61	Add: Ending finished goods inventory		94
62	Total		=SUM(I60:I61)
63	Less: Cost of Goods Manufactured this year		4451
64	Less: Total operating costs
65	Administrative costs	300
66	Depreciation on office building	170
67	Marketing costs	134
68	Total operating costs		=SUM(H65:H67)
69	less: Operating profit		908
70	Beginning finished Goods inventory		=I62-I63-I68-I69