Question

In: Accounting

Custom Designs Please use the following data to determine the value of cost of goods sold...

Custom Designs

Please use the following data to determine the value of cost of goods sold that should be included within Custom Design’s income statement.

Inventories Beginning Ending

Work in Process $120,000 $97,000

Finished Goods $118,000 $140,000

Additional Information

Direct Materials $310,000

Direct Labor $270,000

Labor Hours Worked 6,800 DLH

Estimated Labor Hours Worked 7,000 DLH

Manufacturing Overhead Incurred $254,000

Estimated Manufacturing Overhead $224,000

Solutions

Expert Solution

Cost of Goods sold
Direct material used in production          310,000
Direct labor          270,000
Manufacturing OH Applied          217,600 (224000/7000*6800)
Total current manufacturing cost          797,600
   Plus: Beginning WIP          120,000
Total WIP          917,600
   Less: Ending WIP            97,000
Cost of Goods manufactured          820,600
Plus : Beginning Finished goods          118,000
Cost of goods available for sale          938,600
Less: ending finished inventory          140,000
Cost of goods sold          798,600

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