Question

E2-23A (similar to) Question Help Theta Electronics manufactures and sells a line of video. Unfortunately, Theta Electronics suffered serious fire damage at its home office. As a result, the accounting records for October were partially destroyed and completely jumbled. Theta Electronics has hired you to help figure out the missing pieces of the accounting puzzle. Assume that the Raw Materials Inventory contains only direct materials. 囲 Requirement Find the following amounts: a. Cost of Goods Sold in October b. Beginning Raw Materials Inventory c. Ending Finished Goods Inventory (Click the icon to view the amounts.) Data Table S 27,800 S 1,400 ....S3,100 S 3,400 S 6,100 Revenues in October Work in process inventory, October 31 Raw materials inventory, October 31 Direct labor in October Manufacturing overhead in October Work in process inventory, October 1 Finished goods inventory, October 1 Direct materials used in October . .. . $ Gross profit in October Purchases of direct materials in October ...S a. Find the Cost of Goods Sold in October Determine the Cost of Goods Sold in October by completing the following table Cost of goods sold 4.100 8,200 9,800 Print Done

Answer 1

Answer :-

Finding opening raw material.

We know that, raw material used = opening stock + purchases - closing stock

Opening stock = raw material used + closing stock

= $ 8,200 + $ 3,100

= $ 11,300.

Hence, opening raw material = $ 11,300.

Finding cost of goods sold :-

Sales - cost of goods sold = gross profit

Cost of goods sold = sales + gross profit

Sales = $ 27,800 ; gross profit = $ 12,600.

Therefore Cost of goods sold = $ 15,200.

Finding opening stock of finished goods.

Let us prepare cost sgeet:-

S.no	Particulars	Amount ($)	Amount ($)
01	Raw material used (given)	8200
02	Direct labour	4800
03	Prime cost (01 + 02)		13,000
04	Manufacturing overhead	$ 6,100
05	Gross works cost(03 + 04)		19,100
06	opening stock of WIP	0
07	Less closing WIP	(1400)
08	Net works cost (05 - 06 - 07)		17,700
09	cost of production		17,700
10	add:- opening stock of finished goods	4100
11	less:- closing finished goods	(x)
12	Cost of goods sold (09 + 4100 - ×)		21,800 - x
13	Add :- gross profit		12,600
14	sales (14 = 12 + 13)		27,800
15	closing finished goods		6600*

* Sales (14)= cost of goods sold(12) + gross profit(13)

=> $ 27,800 = $ 21,800 - x + $ 12,600

=> x = $ 21,800 + $ 12,600 - $ 27,800

=> x = $ 6,600.

Hence, finished goods inventory = $ 6,600.