Question

Required information The following selected account balances are provided for Delray Mfg. Sales Raw materials inventory, Dec. 31, 2016 Work in process inventory, Dec. 31, 2016 Finished goods inventory, Dec. 31, 2016 Raw materials purchases Direct labor Factory computer supplies used Indirect labor Repairs-Factory equipment Rent cost of factory building Advertising expense General and administrative expenses Raw materials inventory, Dec. 31, 2017 Work in process inventory, Dec. 31, 2017 Finished goods inventory, Dec. 31, 2017 $ 1,250,000 37,000 53,900 62,750 175,600 225,000 17,840 47,000 5,250 57,000 94,000 129, 300 42,700 41,500 67,300

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Answer 1

DELRAY MFG. Schedule of Cost of Goods Manufactured for Year Ended December 31, 2017 Direct materials Raw materials inventory, Dec 31, 2016 $ 37,000 Add: Raw materials purchases $ 175,600 Raw materials available for use | $212,600 Less: Raw materials inventory, Dec 31, 2017 | $ 42,700 Direct materials used $ 169,900 Direct Labor $ 225,000 Factory Overhead? factory computer supplies used Indirect labor Repairs - Factory equipment Rent cost of factory building $ 17,840 & 47,000 & 5,250 & 57,000 $ 127,090 $521,990 $ 53,900 Total factory overhead costs Total manufacturing costs. Adds work in process inventory, Dec 31, 2016 Total cost of work in process Less: work in process inventory, Dec 31, 2017 - Cost of goods manufactured & 575, 890 & 41,500 & 534,390

DELRAY MFG. Income Statement for Year Ended December 31, 2017 Sales $1,250,000 Cost of goods sold finished goods Inventory , Dec 31, 2016 1 $ 62,750 Add: Cost of goods manufactured $534,390 $529,840 $ 720,160 Cost of goods available for sale | $597, 140 Less: Finished goods inventory Dec 31, 2017 $ 67,300 Cost of goods sola Gross profit Operating expenses Advertising expenses $ 94,000 General and administrative expenses $129,300 Total operating expenses Operating income $ 223,300 & 496,860