Question

he following cost and inventory data are taken from the accounting records of Mason Company for the year just completed:

Costs incurred:
Direct labor cost	$	83,000
Purchases of raw materials	$	131,000
Manufacturing overhead	$	210,000
Advertising expense	$	46,000
Sales salaries	$	105,000
Depreciation, office equipment	$	228,000

   

	Beginning of the Year			End of the Year
Inventories:
Raw materials	$	8,500		$	10,500
Work in process	$	5,100		$	21,000
Finished goods	$	73,000		$	25,700

Required:

1.	Prepare a schedule of cost of goods manufactured.

MASON COMPANY Schedule of Cost of Goods Manufactured Direct materials: Raw materials available for use 0 Raw materials used in production $ 0 Total manufacturing costs 0 0 TIT Cost of goods manufactured $ 0 2. Prepare the cost of goods sold section of Mason Company's income statement for the year. MASON COMPANY Schedule of Cost of Goods Sold Beginning finished goods inventory Goods available for sale Cost of goods sold

Answer 1

Answers Schedule of Cost of Goods Manufacturing Direct Material Beginning, Raw Material Inventory, 8500 ADD: Purchase of Raw Material 131000 Raw material Available For Use 139500 LESS: Ending Raw Material Inventory, 10500 Raw material Used in Production Direct Labor Manufacturing overhead Total Manufacturing cost ADD Beginning Work in Process Inventory 129000 83000 210000 422000 5100 427100 21000 406100 LESS: Ending Work in Process Inventory Cost of Goods Manufactured Cost of Goods Sold Beginning , Finished Good Inventory, ADD: Cost of Goods Manufactured Goods Available for Sale LESS: Ending Finished goods Inventory, Cost of Goods Sold 73000 406100 479100 25700 453400