Question

15 Campbell Manufacturing started in 2018 with the following account balances: Cash $5,700 5,120 6, 000 2,200 Common stock Retained earnings Raw materials inventory Work in process inventory Finished goods inventory (400 units $5.90 each) 860 2,360 Transactions during 2018 1. Purchased $2,890 of raw materials with cash. 2. Transferred $3,770 of raw materials to the production department. 3. Incurred and paid cash for 180 hours of direct labor$15.20 per hour 4. Applied overhead costs to the Work in Process Inventory account. The predetermined overhead rate is $16.40 per direct labor hour 5. Incurred actual overhead costs of $3,000 cash. 6. Completed work on 1,280 units for $5.50 per unit. 7. Paid $1,190 in selling and administrative expenses in caslh 8. Sold 1,280 units for $10,400 cash revenue (assume FIFO cost flow). 9. Campbell charges overapplied or underapplied overhead directly to Cost of Goods Sold. Required a. Record the preceding events in a horizontal statements model. The beginning balances are shown as an example b. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet for 2018 Complete this question by entering your answers in the tabs below. 15 Complete this question by entering your answers in the tabs below Req B Inc Req B Bal Sheet Req B CGM Sched Req A Stmt Record the preceding events in a horizontal statements model. The beginning balances are shown as an example. (Enter decreases to account bal Equity Asscts Event No Raw Work in Finished Common Retained Net Cash + Manufacturing Revenue Expense Materials Process Goods Stock Earnings B.B. 5,700 +S 2,200S 860 2.360$ 5,1206,000 2. 3. 5. 6. 8b Total Req A Req B CGM Sched > Req B CGMReq B Inc Req B Bal Sched Sheet Prepare a schedule of cost of goods manufactured and sold for 2018. CAMPBELL MANUFACTURING COMPANY Cost of Goods Manufactured and Sold For the Year Ended December, 2018 Raw materials available Raw materials used Total manufacturing costs Total work in process inventory Cost of goods manufactured Cost of goods available for sale Cost of goods sold Req B CGM Sched ED 15 Req B CGM Sched Rq IncReq B Bal Stmt Req A Sheet Prepare a balance sheet for 2018. CAMPBELL MANUFACTURING COMPA Balance Shect At December, 2018 Assets Total assets Equity Total equity Req B Inc Stmt Req B Bal Sheet

Answer 1

a.

	Assets					=	Equity
Event No.	Cash	Manufacturing Overhead	Raw Materials	Work in Process	Finished Goods	=	Common Stock	Retained Earnings	Revenue	Expense	Net Income
B.B.	5700		2200	860	2360	=	5120	6000
1	-2890		2890			=
2			-3770	3770		=
3	-2736			2736		=
4		-2952		2952		=
5	-3000	3000				=
6				-7040	7040	=
7	-1190					=		-1190		1190	-1190
8a.	10400					=		10400	10400		10400
8b.					-7200	=		-7200		7200	-7200
9		-48				=		-48		48	-48
Total	6284	0	1320	3278	2200	=	5120	7962	10400	8438	1962

Cost of goods sold = (400 x $5.90) + (880 x $5.50) = $2360 + $4840 = $7200

b.

CAMPBELL MANUFACTURING COMPANY
Cost of Goods Manufactured and Sold
For the Year Ended December, 2018
Beginning raw materials invenotry	2200
Add purchases	2890
Raw materials available	5090
Less ending balance of raw materials	1320
Raw materials used	3770
Direct labor	2736
Manufactuirng overhead	2952
Total manufacturing costs	9458
Add beginning work in process inventory	860
Total work in process inventory	10318
Less ending work in process inventory	3278
Cost of goods manufactured	7040
Add beginning finished goods inventory	2360
Cost of goods available for sale	9400
Less ending finished goods inventory	2200
Cost of goods sold	7200

CAMPBELL MANUFACTURING COMPANY
Income Statement
For the Year Ended December, 2018
Sales revenue	10400
Cost of goods sold	7248
Gross profit	3152
Selling and administrative expenses	1190
Net income	1962

CAMPBELL MANUFACTURING COMPANY
Balance Sheet
At December, 2018
Assets
Cash	6284
Raw materials inventory	1320
Work in process inventory	3278
Finished goods inventory	2200
Total assets	13082
Equity
Common stock	5120
Retained earnings	7962
Total equity	13082

Note: All amounts have been shown as positive amounts in the absence of specific instructions regarding the same. Kindly fill in deductions with a minus sign if required.