Question

Primare Corporation has provided the following data concerning last month’s manufacturing operations. Purchases of raw materials $ 30,000 Indirect materials included in manufacturing overhead $ 4,970 Direct labor $ 59,500 Manufacturing overhead applied to work in process $ 88,800 Underapplied overhead $ 4,170 Inventories Beginning Ending Raw materials $ 11,600 $ 18,300 Work in process $ 54,400 $ 69,900 Finished goods $ 33,900 $ 42,300 Required: 1. Prepare a schedule of cost of goods manufactured for the month. 2. Prepare a schedule of cost of goods sold for the month. Assume the underapplied or overapplied overhead is closed to Cost of Goods Sold.

Answer 1

1	Primare Corporation
	SCHEDULE OF COST OF GOODS MANUFACTURED
		$	$
	Direct materials:
	Beginning Raw materials inventory	11,600.00
	Add: Raw materials purchases	30,000.00
	Raw materials available for use	41,600.00
	Less: Ending Raw materials inventory	(18,300.00)
	Raw materials used in production	23,300.00
	Less: Indirect Materials included in manufacturing overhead	(4,970.00)	18,330.00
	Direct labor		59,500.00
	Manufacturing Overhead applied to work in process		88,800.00
	Total manufacturing costs		166,630.00
	Add: Beginning Work in process inventory		54,400.00
	Total cost of work in process		221,030.00
	Less: Ending Work in process inventory		(69,900.00)
	Cost of goods manufactured		151,130.00
2	Computation cost of goods sold for the year
		$
	Beginning Finished Goods	33,900.00
	Add: Cost of goods manufactured	151,130.00
	Cost of goods available for sale	185,030.00
	Less: Ending Finished Goods	(42,300.00)
	Unadjusted Cost of goods sold	142,730.00
	Add: Under applied overhead	4,170.00
	Adjusted Cost of goods sold	146,900.00