Question

Nis question: 25 pts 1 of 4 (0 complete This Test: 100 pt Natural Bones manufactures its own brand of pet chew bones. At the end of December 2018, the accounting records showed the following: (Click the icon to view account balances.) !!! (Click the icon to view other information.) Read the requirements Requirement 1. Prepare a schedule of cost of goods manufactured for Natural Bones for the year ended December 31, 2018. (For accounts with a $0 balanco, sure to enter "O" in the appropriate column) Natural Bones Schedule of Cost of Goods Manufactured Year Ended December 31, 2018 Beginning Work-in-Process Inventory Direct Materials Used: Choose from any list or enter any number in the input fields and then continue to the next question.

Answer 1

1
	Natural Bones
	Schedule of Cost of Goods Manufactured
	Year Ended December 31, 2018
		($ )	($ )	($ )
	Beginning Work-in-Process Inventory			-
	Direct Materials Used:
	Beginning Raw Materials Inventory	13,300.00
	Purchases of Raw Materials	31,000.00
	Raw Materials Available for Use	44,300.00
	Less: Ending Raw Materials Inventory	10,000.00
	Direct Materials Used		34,300.00
	Direct Labor		22,000.00
	Manufacturing Overhead:
	Utilities for Plant	1,400.00
	Plant Janitorial Services	400.00
	Rent on Plant	18,000.00
	Total Manufacturing Overhead		19,800.00
	Total Manufacturing Costs Incurred during the Year			76,100.00
	Less: Ending Work-in-Process Inventory			1,100.00
	Cost of Goods Manufactured			75,000.00

Note
Direct material + Direct Labour +Manufactruring OH =   Total Manufacturing cost incurred during the Year
Total Manufacturing Cost + Opening WIP - Ending WIP = Cost of Goods Manufactured

2
	Natural Bones
	Income Statement
	Year Ended December 31, 2018
		($ )	($ )
	Revenue:
	Sales Revenue		1,08,000.00
	Cost of Goods Sold:
	Beginning Finished Goods Inventory	-
	Cost of goods Manufactured	75,000.00
	Cost of goods Available for Sale	75,000.00
	Less: Ending Finished Goods Inventory	5,900.00
	Cost of Goods Sold		69,100.00
	Gross Profit		38,900.00
	Selling and Administration Expenses:
	Delivery Expenses	1,700.00
	Sales Salary Expenses	5,300.00
	Customer Service Hotline Expenses	1,800.00
	Total Selling and Administrative Expenses		8,800.00
	Operative Income		30,100.00

3.

In a manufacturing company, you will show different categories of expenses than you would for a merchandising company.

The method for reporting earnings is the same for merchandisers and manufacturers.

The method for calculating this figure is to add inventory on hand at the beginning of the accounting period to inventory purchased during the accounting period. Subtract the inventory on hand at the end of the period, and subtract any freight charges. This is the cost-of-goods figure for a merchandiser.

Manufacturers break the cost of goods into categories. Raw materials expenses make up the first category of manufacturing expenses. The manufacturer must also inventory goods-in-progress. In addition, manufacturers must count finished products that are available for sale. Manufacturers also count the cost of manufacturing labour and factory overhead in determining expenses that are related to the cost of goods. This is quite different from merchandisers who do not include labour in cost-of-goods figures.

The merchandiser refers to expenses as “cost of goods sold.” Manufacturers often refer to expenses and “cost of goods manufactured.”

A manufacturer's cost of goods sold is based on its cost of goods manufactured. In contrast, a merchandiser's cost of goods sold is based on its merchandise purchases. A manufacturer's cost of goods sold is based on its cost of goods manufactured. In contrast, a merchandiser's cost of goods sold is based on its merchandise purchases.

4
	Unit Product Cost
	Units Manufactured		17,600.00
	Cost of Goods Manufactured		75,000.00
			4.26/unit
	Note
	Unite Production Cost= Cost of Goods Manufactured/Units Manufactured