Answer:
a. Cost of goods manufactured statement for January.
Work in process inventory, January 1 $ 135,240
Direct materials:
Materials inventory, January 1 $ 196,000
Purchases $376,320
Cost of materials available for use $ 572,320
Materials inventory, January 31 ($176,400)
Cost of direct materials used in production $ 395,920
Direct labor $352,800
Factory overhead:
Indirect labor $ 37,630
Machinery depreciation $22,740
Heat, light, and power $7,840
Supplies $6,270
Property taxes $5,490
Miscellaneous costs $10,190
Total factory overhead $90,160
Total manufacturing costs incurred during January $442,950
Total manufacturing costs $ 442,950
Work in process inventory, January 31 ($121,720)
Cost of goods manufactured $456,470
b. Determine the cost of goods sold for January.
Beginning Finished goods Inventory $99,960
Add Cost of goods manufactured $456,470
Less Ending Finished goods Inventory ($118,190)
Cost of goods sold $438,240
Explanation:
The Costs of Goods Manufactured is obtained from preparing a manufacturing cost schedule. This is an accumulation of all manufacturing costs.
The cost of goods sold is obtained by preparing Finished Goods Account or schedule as above.
