Question

In: Accounting

The Corporation incurred the following costs while manufacturing its product: Materials used in product                  $121,500      

The Corporation incurred the following costs while manufacturing its product:

Materials used in product                  $121,500         Advertising expense               $45,400          

Depreciation on plant                         62,400             Property taxes on plant                      19,300

Property taxes on warehouse            8,400               Delivery expense                    21,000

Labour costs of assembly-line workers          110,700           Sales commissions                  35,100

Factory supplies used             25,000             Salaries paid to sales clerks                50,600

Work in process inventory was $10,000 at January 1 and $14,300 at December 31. Finished goods inventory was $60,600 at January 1 and $51,100 at December 31.

Calculate the cost of goods manufactured.

2.

The Company reported the following costs and expenses in May:

Factory utilities                                   $25,300           Direct labour                           $91,000

Depreciation on factory equipment   22,650             Sales salaries                           54,600

Depreciation on delivery trucks         6,600               Property taxes on factory building     2,670

Indirect factory labour                        56,300             Repairs to office equipment   2,900

Indirect materials                               89,600             Factory repairs                        3,000

Direct materials used                         144,800           Advertising                              26,000

Factory manager’s salary                    19,100             Office supplies used                5,790

Determine the total amount of product costs. Ignore the money sign.

Solutions

Expert Solution

1.

Schedule of Cost of Goods manufactured
Raw Material used in production $         121,500
Direct Labor $         110,700
Manufacturing Overhead
Depreciation on Plant $          62,400
Factory Supplies Used $          25,000
Property Taxes on Plant $          19,300 $         106,700
Total Manufacturing Costs $         338,900
Add: Beginning Work in Process Inventory $           10,000
$         348,900
Deduct: Ending Work in Process Inventory $           14,300
Cost of Goods Manufactured $        334,600

2.

Product Cost
Factory Utilities $          25,300
Depreciation on factory equipment $          22,650
Indirect Factory Labor $          56,300
Indirect Material $          89,600
Direct Material Used $        144,800
Factory Manager's Salary $          19,100
Direct Labor $          91,000
Property Taxes on Factory Building $             2,670
Factory Repairs $             3,000
Total Product Cost $        454,420

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