Question

rimare Corporation has provided the following data concerning last month’s manufacturing operations.

Purchases of raw materials	$	31,000
Indirect materials included in manufacturing overhead	$	4,820
Direct labor	$	58,500
Manufacturing overhead applied to work in process	$	88,900
Underapplied overhead	$	4,060

Inventories	Beginning		Ending
Raw materials	$	12,000	$	18,500
Work in process	$	55,400	$	65,300
Finished goods	$	34,900	$	42,100

Required:

1. Prepare a schedule of cost of goods manufactured for the month.

2. Prepare a schedule of cost of goods sold for the month. Assume the underapplied or overapplied overhead is closed to Cost of Goods Sold.
Primare Corporation has provided the following data concerning last month's manufacturing operations. Purchases of raw materials Indirect materials included in manufacturing overhead Direct labor Manufacturing overhead applied to work in process Underapplied overhead $31,000 $ 4,820 $58,500 $88,900 $ 4,060 Inventories Raw materials Work in process Finished goods Beginning $ 12,000 $ 55,400 $ 34,900 Ending $ 18,500 $ 65,300 $ 42,100 Required: 1. Prepare a schedule of cost of goods manufactured for the month. 2. Prepare a schedule of cost of goods sold for the month. Assume the underapplied or overapplied overhead is closed to Cost of Goods Sold. Complete the question by entering your answers in the tabs below. Required 1 Required 2 Prepare a schedule of cost of goods manufactured for the month. Primare Corporation Schedule of Cost of Goods Manufactured Direct materials: Beginning raw materials inventory $ Add: Purchases of raw materials Total raw materials available Less: Ending raw materials inventory Raw materials used in production 12,000 31,000 42,100 18,500 $ 0 Total manufacturing costs 0 Cost of goods manufactured < Required 1 Required 2 >

Answer 1

Solution:
1st	Primare Corporation
	Schedule of cost of goods manufactured

	Direct Materials:
a	Beginning materials inventory	12,000
b	Add: Purchases of raw materials	31,000
c=a+b	Raw materials available for use	43,000
d	Less: Ending raw materials inventory	18,500
e=c-d	Raw materials used in production	24,500
f	Less: Indirect materials included in manufacturing overhead cost incurred	4,820	19,680
g	Direct Labor		58,500
h	Manufacturing overhead applied to Work in Process		88,900
i=f+g+h	Total manufacturing costs		167,080
j	Add: Beginning work in process inventory		55,400
k=i+j			222,480
l	Less: Ending work in process inventory		65,300
m=k-l	Cost of goods manufactured		157,180

2nd.
	Primare Corporation
	Schedule of cost of goods sold

a	Beginning finished goods inventory	34,900
b	Add: Cost of goods manufactured	157,180
c=a+b	cost of goods available for sale	192,080
d	Less: Ending finished goods inventory	42,100
e=c-d	Unadjusted cost of goods sold	149,980
f	Add: Underapplied overhead	4,060
g=e+f	Adjusted cost of goods sold	154,040

Notes:	Underapplied overhead means applied overhead is lesser than actual overhead so it is added to unadjusted cost of goods sold to get accurate adjusted cost of goods sold . By adding this underapplied overhead we are allocating all the cost which are incurred for the goods sold.

Please feel free to ask if anything about above solution in comment section of the question.