Question

The following balances are from the accounts of Crabtree Machining Company:

	January 1 (Beginning)			December 31 (Ending)
Direct materials inventory	$	115,200		$	141,600
Work-in-process inventory		139,200			134,400
Finished goods inventory		117,120			108,000

Direct materials purchased during the year amount to $717,600, and the cost of goods sold for the year was $2,606,880.

Required:

Prepare a cost of goods sold statement.

	CRABTREE MACHINING COMPANY Cost of Goods Sold Statement For the Year Ended December 31 Beginning inventory Manufacturing costs: Direct materials: Materials available $0 Direct materials used $0 Total manufacturing costs 0 Total costs of work-in-process $0 Cost of goods manufactured $0 Finished goods available for sale $0 Cost of goods sold $0

Answer 1

Solution:

CRABTREE MACHINING COMPANY
Cost of goods sold statement
For the year ended december 31
Beginning inventory work in Process			$1,39,200.00
Manufacturing Costs
Direct Material:
Beginning Direct Material inventory	$1,15,200.00
Direct material purchases	$7,17,600.00
Materials available	$8,32,800.00
Ending Direct Material inventory	$1,41,600.00
Direct Material used		$6,91,200.00
Conversion costs ($2592960-$691200)			$19,01,760.00
Total Manufacturing costs ($2732160 - $139200)			$25,92,960.00
Total cost of Work in process ($2597760+$134400)			$27,32,160.00
Less: ending inventory Work in Process			$1,34,400.00
Cost of goods manufactured ($2714880 -$117120)			$25,97,760.00
Beginning finished goods inventory			$1,17,120.00
Finished goods savailable for sale ($2606880+$108000)			$27,14,880.00
Ending finished goods inventory			$1,08,000.00
Cost of goods sold			$26,06,880.00