Question

A company collected the following data for the month ending May 31:

Inventories	May 1	May 31
Materials	$23,000	$18,480
Work in process	$14,800	$15,600
finished goods	$12,920	$12,620
direct labor	$37,800
materials purchased during may	$42,300
Factory overhead incurred during May:
indirect labor		$4,320
machinery depreciation		$2,400
heat, light, and power		$480
supplies		$627
property taxes		$580
miscellaneous costs		$1,920

REQUIRED:

a. Prepare a cost of goods manufactured statement for may

b. Determine the cost of goods sold for May. Show your work.

Answer 1

· a)

Schedule of Cost of goods manufactured

Direct materials:
Beginning raw material inventory	23,000
Add: Purchases of raw material	42,300
Total raw materials available	65,300
Less: Ending raw materials inventory	- 18,480
Raw materials used in production		46,820
Direct labor		37,800
Manufacturing overheads:
indirect labor	4,320
machinery depreciation	2,400
heat, light, and power	480
supplies	627
property taxes	580
miscellaneous costs	1,920
Total Manufacturing overheads		10,327
Total manufacturing cost		94,947
Add: Beginning work in process inventory		14,800
Less: Ending work in process inventory		- 15,600
Cost of goods manufactured		94,147

Cost of goods manufactured = $94,147

· Schedule of cost of goods sold

Beginning finished goods inventory	12,920
Add: Cost of goods manufactured	94,147
Cost of goods available for sale	107,067
Less: Ending finished goods inventory	- 12,620
cost of goods sold	94,447

cost of goods sold = $94,447

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