Question

he following data were taken from the records of Clarkson Company for the fiscal year ended June 30, 2017. Raw Materials Inventory 7/1/16 $48,000 Factory Insurance $4,600 Raw Materials Inventory 6/30/17 39,600 Factory Machinery Depreciation 16,000 Finished Goods Inventory 7/1/16 96,000 Factory Utilities 27,600 Finished Goods Inventory 6/30/17 75,900 Office Utilities Expense 8,650 Work in Process Inventory 7/1/16 19,800 Sales Revenue 534,000 Work in Process Inventory 6/30/17 18,600 Sales Discounts 4,200 Direct Labor 139,250 Plant Manager’s Salary 58,000 Indirect Labor 24,460 Factory Property Taxes 9,600 Accounts Receivable 27,000 Factory Repairs 1,400 Raw Materials Purchases 96,400 Cash 32,000

Prepare a cost of goods manufactured schedule. (Assume all raw materials used were direct materials.)

Prepare an income statement through gross profit.

Prepare the current assets section of the balance sheet at June 30, 2017

Answer 1

A cost of goods manufactured schedule
Raw Materials Inventory 7/1/16	$48,000
Add : Raw Materials Purchases	$96,400
Less : Raw Materials Inventory 6/30/17	$39,600
Direct Material Used		$104,800
Direct Labor		$139,250
Manufacturing Overheads
Factory Insurance	$4,600
Factory Machinery Depreciation	$16,000
Factory Utilities	$27,600
Plant Manager’s Salary	$58,000
Indirect Labor	$24,460
Factory Property Taxes	$9,600
Factory Repairs	$1,400
Total Manufacturing overheads		$141,660
Cost of Manufacturing for the year		$385,710
Add :   Work in Process Inventory 7/1/16		$19,800
Total Work in process cost		$405,510
Less : Work in Process Inventory 6/30/17		$18,600
Cost of Goods Manufactured		$386,910
Income statement through gross profit.
Sales Revenue		$534,000
Less : Cost of goods sold
Cost of goods Manufactured	$386,910
Add : Finished Goods Inventory 7/1/16	$96,000
Less : Finished Goods Inventory 6/30/17	$75,900
Cost of goods sold		$407,010
Gross Margin		$126,990
Less : Selling and administrative expenses
Office Utilities Expense	$8,650
Sales Discounts	$4,200	$12,850
Net Operating Income		$114,140
Current assets section of the balance sheet at June 30, 2017
Current Assets
Cash		$32,000
Accounts Receivable		$27,000
Inventory
- Raw Material Inventory	$39,600
- Work in process Inventory	$18,600
- Finished Goods Inventory	$75,900	$134,100
Total Current Assets		$193,100