Question

Question 1: Data about Company A is given below: Direct Material Inventory, January 1, 2018 WIP Inventory, January 1, 2018 Finished Goods Inventory, January 1, 2018 200.000 600.000 400.000 Sales Revenue 13.000.000 Rent Revenue 260.000 Interest Expense 200.000 Direct Material Purchase Utilities Expense of Manufacturing Sales discount Depreciation Expense of Manufacturing Plant Repair and Maintenance Expense of Marketing Department Indirect Labor Utilities Expense of Marketing Department Indirect Material Dividend Revenue Supplies Expense of Manufacturing Department 1.500.000 500.000 50.000 1.600.000 320.000 600.000 800.000 280.000 200.000 160.000 30.000 oaneose borslen anhuzhunems old Sales return %20 Tax Expense Direct Labor Expense Direct Material Inventory, December 31, 2018 WIP Inventory, December 31, 2018 unsm Finished Goods Inventory, December 31, 2018 oons n1.800.000 300.000 200.000 300.000 000 2 o val Required: Prepare a Cost of Goods Manufactured/Sold Statement and an Income Statement of Company A for the year 2018. badin T DO0.00nonovnl boo baups bohsg ato

Answer 1

COST OF GOODS SOLD
WIP inventory, January 1, 2018			$     6,00,000
Direct material cost:
Direct material inventory, January 1, 2018	$      2,00,000
Add: Direct material purchases	$    15,00,000
Total materials available for use	$    17,00,000
Less: Direct materials inventory, December 31, 2018	$      3,00,000
Direct material cost		$    14,00,000
Direct labor expense		$    18,00,000
Factory overhead:
Utilities expense	$      5,00,000
Depreciation expense	$    16,00,000
Indirect labor	$      6,00,000
Indirect material	$      2,80,000
Total factory overhead		$    29,80,000
Manufacturing cost incurred during the month			$   61,80,000
Total manufacturing cost			$   67,80,000
Less: Work in process inventory, December 31, 2018			$     2,00,000
Cost of goods manufactured during the month			$   65,80,000
Finished goods inventory, January 1, 2018			$     4,00,000
Cost of goods available for sale			$   69,80,000
Finished goods inventory, December 31, 2018			$     3,00,000
Cost of goods sold			$   66,80,000
INCOME STATEMENT
Sales revenue	$1,30,00,000
Less: Sales returns	$          30,000
Less: Sales discounts	$          50,000
Net sales		$ 1,29,20,000
Less: Cost of goods sold		$    66,80,000
Gross profit		$    62,40,000
Operating expenses:
Repair and maintenance-Marketing	$      3,20,000
Utilities expense-Marketing	$      8,00,000
Supplies expense-Marketing	$      1,60,000
Total operating expenses		$    12,80,000
Net operating income		$    49,60,000
Other income/(expenses):
Rent revenue	$      2,60,000
Interest expense	$     -2,00,000
Dividend revenue	$      2,00,000
Total other income/(expenses)		$       2,60,000
Income before taxes		$    47,00,000
Tax expense [20%]		$       9,40,000
Net income		$    37,60,000