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The following data refer to Twisto Pretzel Company for the year 20x1.

Work-in-process inventory, 12/31/x0	$	8,000
Selling and administrative salaries		13,600
Insurance on factory and equipment		3,600
Work-in-process inventory, 12/31/x1		8,100
Finished-goods inventory, 12/31/x0		14,000
Cash balance, 12/31/x1		8,000
Indirect material used		4,300
Depreciation on factory equipment		2,100
Raw-material inventory, 12/31/x0		10,200
Property taxes on factory		2,400
Finished-goods inventory, 12/31/x1		15,200
Purchases of raw material in 20x1		39,000
Utilities for factory		6,000
Utilities for sales and administrative offices		2,400
Other selling and administrative expenses		3,800
Indirect-labor cost incurred		29,000
Depreciation on factory building		3,800
Depreciation on cars used by sales personnel		1,200
Direct-labor cost incurred		79,000
Raw-material inventory, 12/31/x1		11,000
Accounts receivable, 12/31/x1		4,100
Rental for warehouse space to store raw material		2,900
Rental of space for company president’s office		1,600
Applied manufacturing overhead		58,000
Sales revenue		205,800
Income tax expense		5,100
Required: 1. Prepare Twisto Pretzel Company’s schedule of cost of goods manufactured for 20x1.

Answer 1

• SOLUTION

  Schedule of cost of goods manufactured-

  Particulars	Amount ($)	Amount ($)
  Direct material:
  Beginning raw material inventory	10,100
  Add: Purchase of raw material	39,000
  Raw material available for use	49,100
  Deduct: Ending raw material inventory	(11,000)
  Raw material used		38,100
  Direct Labor		79,000
  Manufacturing overhead-
  Insurance on factory and Equipment	3,600
  Indirect material used	4,600
  Depreciation of factory equipment	2,100
  Property taxes on factory	2,400
  Utilities for factory	6,000
  Indirect labor	29,000
  Depreciation on factory building	3,600
  Rental for warehouse to store raw material	2,900
  Total actual manufacturing overhead	54,200
  Add: Over applied overhead (58,000-54,200)	3,800
  Applied manufacturing overhead		58,000
  Total manufacturing costs		175,100
  Add: Beginning Work in progress inventory		8,000
  		183,100
  Less: Ending Work in progress inventory		(8,300)
  Cost of goods manufactured		174,800