Question

The following data from the just completed year are taken from the accounting records of Mason Company: Sales Direct labor cost Raw material parchases Selling expenses Administrative expenses Manufacturing over hend applied to work in process Actual manufacturing overhead costs $ 654,000 $ 82,000 $ 133,000 $ 107,000 $ 41,000 $ 229,000 $ 209,000 k Inventories Raw materials Work in process Finished goods Beginning Ending $ 8,300 10,400 $ 5,300 $20,400 $ 77,000 $ 25,100 1 ences Required: 1. Prepare a schedule of cost of goods manufactured. Assume all raw materials used in production were direct materials. 2. Prepare a schedule of cost of goods sold. Assume that the company's underapplied or overapplied overhead is closed to Cost of 3. Prepare an income statement. Goods Sold. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare a schedule of cost of goods manufactured. Assume all raw materials used in production were direct materials Mason Company Schedule of Cost of Goods Manufactured Direct materials < Prev 4 of 4 !!! Next

Answer 1

Solution

Mason company
Schedule of Cost of Goods Manufactured
Direct Material
Raw material Inventory Beginning	$ 8,300
Raw material Purchased	$ 133,000
Raw material available for use	$ 141,300
Less: Raw material Inventory Ending	$ 10,400
Direct Material Used		$ 130,900
Direct labor		$ 82,000
Total Manufacturing overheads applied		$ 229,000
Total manufacturing Cost During the month		$ 441,900
Add: Work in process Beginning		$ 5,300
Total Work in Process		$ 447,200
Less: Work in progress Ending		$ 20,400
Cost of Goods Manufactured		$ 426,800

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Mason company
Schedule of cost of goods sold
Beginning Finished Goods Inventory		$ 77,000
Add: Cost of goods manufactured		$ 426,800
Goods Available for sale		$ 503,800
Less :Ending Finished goods Inventory		$ 25,100
Unadjusted Cost of Goods Sold		$ 478,700
Overapplied Manufacturing overheads		-$ 20,000
Adjusted cost of goods sold		$ 458,700

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Mason company
Income statement
Sales revenue		$ 654,000
Less: Cost of goods sold		$ 458,700
Gross profit		$ 195,300
Selling and administrative expenses
Selling expenses	$ 107,000
Administrative expenses'	$ 41,000	$ 148,000
Net income		$ 47,300