Ask Question
22 October, 23:39

The following data from the just completed year are taken from the accounting records of Mason Company:

Sales $ 657,000

Direct labor cost $ 84,000

Raw material purchases $ 134,000

Selling expenses $ 101,000

Administrative expenses $ 49,000

Manufacturing overhead applied to work in process $ 203,000

Actual manufacturing overhead costs $ 225,000

Inventories

Beginning of Year End of Year

Raw materials $ 8,500 $ 10,900

Work in process $ 5,500 $ 20,400

Finished goods $ 79,000 $ 25,900

Required:

1. Prepare a schedule of cost of goods manufactured. Assume all raw materials used in production were direct materials.

2. Prepare a schedule of cost of goods sold. Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold.

3. Prepare an income statement.

+3
Answers (1)
  1. 22 October, 23:43
    0
    Answer and Explanation:

    1. The preparation of the schedule of cost of goods manufactured is presented below:

    Mason Company

    Cost of Goods manufactured Statement

    Beginning work-in-process inventory $5,500

    Manufacturing costs:

    Direct materials:

    Beginning inventory $8,500

    Purchases $134,000

    Materials available $142,500

    Less: Ending inventory - $10,900

    Direct materials used $131,600

    Direct labor cost $84,000

    Other manufacturing costs $203,000

    Total manufacturing costs: $418,600

    Total costs of work-in-process $424,100 Less: Ending work-in-process - $20,400

    Cost of goods manufactured $403,700

    2. The preparation of the schedule of cost of goods sold is presented below:

    Mason Company

    Cost of Goods Sold Statement

    Cost of goods manufactured $403,700

    Add: opening stock of finished goods $79,000

    Less: Closing stock of finished goods - $25,900

    Unadjusted cost of goods sold $456,800

    Add: Under applied overhead $22,000

    Cost of goods sold $478,800

    3. The preparation of the income statement is presented below:

    Mason Company

    Income statement

    Sales $657,000

    Less: Cost of goods sold - $478,800

    Gross profit $178,200

    Less: expenses

    Selling expenses $101,000

    Administrative expenses $49,000 - $150,000

    Net income $28,200
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “The following data from the just completed year are taken from the accounting records of Mason Company: Sales $ 657,000 Direct labor cost $ ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers