The accounting records of Idaho Paper Company include the following information relating to the current year:
| Dec. 31 | Jan. 1 |
Materials inventory | $ 20,000 | $ 25,000 |
Work in process inventory | 37,500 | 40,000 |
Finished goods inventory, Jan. 1 (10,000 units @ $21 per unit) | ? | 210,000 |
Purchases of direct materials during year | 330,000 |
|
Direct labor costs assigned to production | 375,000 |
|
Manufacturing overhead | 637.500 |
|
The company manufactures a single product; during the current year, 45,000 units were manufactured and 40.000 units were sold.
Instructions
a. Prepare a schedule of the cost of finished goods manufactured for the current year. (Show a supporting computation of the cost of direct materials used during the year.)
b. Compute the average per-unit cost of production during the current year.
c. Compute the cost of goods sold during the year, assuming that the FIFO (first-in, first-out) method of inventory costing is used.
d. Compute the cost of the inventory of finished goods at December 31 of the current year, assuming that the FIFO (first-in first-out) method of inventory costing is used.
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