Question

Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials): $ 140.000 $ 290,000 Selling expenses Purchases of raw materials Direct labor Administrative expenses Manufacturing overhead applied to work in process Actual manufacturing overhead cost $ 100,000 $285,000 $ 270,000 Inventory balances at the beginning and end of the year were as follows: Raw materials Work in process Pinished goods Beginning of Year End of Year $ 40,000 $10,000 ? $ 35,000 $ 50,000 The total manufacturing costs for the year were $683,000; the cost of goods available for sale totaled $740,000; the unadjusted cost of goods sold totaled $660,000; and the net operating income was $30,000. The company's underapplied or overapplied overhead is closed to Cost of Goods Sold. Required: Prepare schedules of cost of goods manufactured and cost of goods sold and an income statement. (Hint. Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.) Complete this question by entering your answers in the tabs below. Income Statement COGS Schedule COGM Schedule

Answer 1

Income statement

Sales		915000
Cost of goods sold (660000-15000)		645000
Gross profit		270000
Selling and administrative expense
Selling expense	140000
Administrative expense	100000
Total Selling and administrative expense		240000
Net operating income		30000

Schedule of cost of goods sold

Beginning finished goods	50000
Cost of goods manufactured	690000
Cost of goods available for sale	740000
Ending finished goods	-80000
Unadjusted cost of goods sold	660000
Less: Over applied overhead	-15000
Adjusted cost of goods sold	645000

Schedule of cost of goods manufactured

Direct material
Beginning raw material	40000
Raw material purchase	290000
Raw material available for use	330000
Less: Ending raw material	-10000
Direct material used		320000
Direct labor		78000
Manufacturing overhead		285000
Total manufacturing cost		683000
Beginning work in process		42000
Total Cost of work in process		725000
Less: Ending work in process		35000
Cost of goods manufactured		690000