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Manufacturing Income Statement, Statement of Cost of Goods Manufactured Several items are omitted from the income...

Manufacturing Income Statement, Statement of Cost of Goods Manufactured

Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies for the month of December.

On
Company
Off
Company
Materials inventory, December 1 $55,730 $74,680
Materials inventory, December 31 (a) 84,390
Materials purchased 141,550 (a)
Cost of direct materials used in production 149,360 (b)
Direct labor 210,100 168,030
Factory overhead 65,200 83,640
Total manufacturing costs incurred in December (b) 483,180
Total manufacturing costs 531,660 663,160
Work in process inventory, December 1 107,000 179,980
Work in process inventory, December 31 90,280 (c)
Cost of goods manufactured (c) 478,700
Finished goods inventory, December 1 94,180 83,640
Finished goods inventory, December 31 98,640 (d)
Sales 821,460 746,800
Cost of goods sold (d) 483,180
Gross profit (e) (e)
Operating expenses 107,000 (f)
Net income (f) 165,790

Required:

1. Determine the amounts of the missing items, identifying them by letter. Enter all amounts as positive numbers.

Letter On Company Off Company
a. $ $
b. $ $
c. $ $
d. $ $
e. $ $
f. $ $

2. Prepare On Company's statement of cost of goods manufactured for December.

On Company
Statement of Cost of Goods Manufactured
For the Month Ended December 31
Work in process inventory, December 1 $
Direct materials:
Materials inventory, December 1 $
Purchases
Cost of direct materials used in production $
Less materials inventory, December 31
Cost of direct materials used in production $
Direct labor
Factory overhead
Total manufacturing costs incurred during December
Total manufacturing costs $
Less work in process inventory, December 31
Cost of goods manufactured $

3. Prepare On Company's income statement for December.

On Company
Income Statement
For the Month Ended December 31
Sales $
Cost of goods sold:
Finished goods inventory, December 1 $
Cost of goods manufactured
Cost of finished goods available for sale $
Less finished goods inventory, December 31
Cost of goods sold
Gross profit $
Operating expenses
Net income $

Solutions

Expert Solution

PART 1: MISSING ITEMS

ON COMPANY

(a) Materials inventory, December 31:

= Materials inventory, December 1 + Materials Purchased - Cost of direct materials used in production

= $55,730 + $141,550 - $149,360

= $47,920

(b) Total Manufacturing costs incurred in December

= Cost of direct materials used in production + Direct Labor + Factory overheads

= $149,360 + $210,100 + $65,200

= $424,660

(c) Cost of goods manufactured

= Total manufacturing cost - Work in process inventory, December 31

= $531,660 - $90,280

= $441,380

(d) Cost of goods sold

Finished goods inventory, December 1+Cost of goods manufactured-Finished goods inventory, December 31

= $94,180 + $441,380 - $98,640

= $436,920

(e) Gross Profit

= Sales - Cost of goods sold

= $821,460 - $436,920

= $384,540

(f) Net Income

= Gross Profit - Operating expenses

= $384,540 - $107,000

= $277,540

OFF COMPANY

(b) Cost of materials used in production

= Total manufacturing cost incurred in December - Direct labor - Factory overhead

= $483,180 - $168,030 - $83,640

= $231,510

(a) Materials Purchased

= Cost of materials used in production - Materials inventory, December 1 + Materials inventory, December 31

= $231,510 - $74,680 + $84,390

= $241,220

(c) Work in process inventory, December 31

= Total manufacturing costs - Cost of goods manufactured

= $663,160 - $478,700

= $184,460

(d) Finished goods inventory, December 31

= Finished goods inventory, December 1 + Cost of goods manufactured - Cost of goods sold

= $83,640 + $478,700 - $483,180

= $79,160

(e) Gross Profit

= Sales - Cost of goods sold

= $746,800 - $483,180

= $263,620

(f) Operating expenses

= Gross Profit - Net Income

= $263,620 - $165,790

= $97,830

PART 2:

ON COMPANY

STATEMENT OF COST OF GOODS MANUFACTURED

FOR THE MONTH ENDED DECEMBER 31

PART 3:

ON COMPANY

INCOME STATEMENT

FOR THE MONTH ENDED DECEMBER 31

All the best...


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