Question

P1-9 Data analysis; manufacturing statement Glasson Manufacturing Co. produces only one product. You have obtained the following information from the corporation's books and records for the current year ended December 31, 2016: a. Total manufacturing cost during the year was $1,000,000, including direct materials, direct labor, and factory overhead. b. Cost of goods manufactured during the year was $970,000. c. Factory Overhead charged to Work in Process was 75% of direct labor cost and 27% of the total manufacturing cost. d. The beginning Work in Process inventory, on January 1, was 40% of the ending Work in Process inventory, on December 31. e. Material purchases were $400,000 and the ending balance in Materials inventory was $60,000. No indirect materials were used in production. Required: Prepare a statement of cost of goods manufactured for the year ended December 31 for Glasson Manufacturing. (Hint: Set up a state- ment of cost of goods manufactured, putting the given information in the appropriate spaces and solving for the unknown information.)

Answer 1

Glasson Manufacturing Statement of Cost of Goods Manufactured For the Year Ended December 31, 2016 Direct Materials: Inventory, January 1 Add purchases Total cost of available materials Less: inventory, December 31 Cost of materials used Less :indirect materials used Direct materials used Direct labor Factory overhead Total manufacturing cost Add: work in process inventory, January 1 Subtotal Less :work in process inventory, December 31 Cost of goods manufactured 30000 400000 430000 -60000 370000 0 0 370000 360000 270000 1000000 20000 1020000 -50000 970000