Question

Using this data, comput (a) the finished goods inventory at May 1 and May 31. (b) the work-in-progress inventory at May 1 and May 31, and (c) the cost of goods sold for May. Hampton began operations with Job 1.

Job Started Total Production Costs Added in May 1 2. 3 4 4/10 4/18 4/24 4/28 5/15 5/22 Dates Finished 4/20 4/30 5/10 5/20 6/10 6/18 Shipped 5/9 5/20 5/25 6/3 6/20 6/28 Total Costs Assigned at April 30 $7.300 5.400 2.900 3,600 55,700 4,800 2,600 3,800 6

Answer 1

1) Calculation of finished Goods Inventory

As on May 1

Job 1 and Job 2 are finished before May month and sold after May 1.

So Cost of Finished as May 1 = Total Cost of Job 1 and Job 2

= $7300+$5400=12700

As on May 31

Job 4 is finished on 5/20 and sold on 6/3. So as on May 31 Job 4 is the only finished goods

So Cost of finished goods as on May 31= Total Cost of Job 4

= $3600+$4800

=$8400

2) Calculation of Work in Progress Goods

As on May 1

As on May 1 Job 3 and Job 4 are in Work in progress. That is job started before May 1 and finished after May 1

So Cost of WIP as on May 1= Cost assigned on april for Job 3 and Job 4

= $2900+$3600

= $6500

As on May 31

As on May 31 Job 5 and Job 6 are in Work in Progress. That is Job started before May 31 and finished after May 31

So Cost of WIP as on May 31= Cost assigned on May for Job 5 and Job 6

=$2600+$3800

= $6400

3) Calculation of Cost of Goods Sold

Sales During May is Job 1 ,Job 2 and Job 3.

Cost of Goods sold =Total Cost incurred for Job 1. Job 2 and Job 3

= $7300+$5400+$2900+$5700

= $21300