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Statement of Cost of Goods Manufactured and Income Statement for a Manufacturing Company The following information...

Statement of Cost of Goods Manufactured and Income Statement for a Manufacturing Company

The following information is available for Shanika Company for 20Y6:

Inventories January 1 December 31
Materials $296,600 $364,820
Work in process 533,880 496,160
Finished goods 513,120 507,100
Advertising expense $247,710
Depreciation expense-office equipment 35,020
Depreciation expense-factory equipment 47,060
Direct labor 561,820
Heat, light, and power-factory 18,610
Indirect labor 65,670
Materials purchased 550,880
Office salaries expense 192,260
Property taxes-factory 15,320
Property taxes-headquarters building 31,740
Rent expense-factory 25,900
Sales 2,579,280
Sales salaries expense 316,660
Supplies-factory 12,770
Miscellaneous costs-factory 8,030

Required:

1. Prepare the statement of cost of goods manufactured.

Shanika Company
Statement of Cost of Goods Manufactured
For the Year Ended December 31, 20Y6
$
Direct materials:
$
$
$
Factory overhead:
$
Total factory overhead
Total manufacturing costs incurred
Total manufacturing costs $
Cost of goods manufactured $

2. Prepare the income statement.

Shanika Company
Income Statement
For the Year Ended December 31, 20Y6
$
Cost of goods sold:
$
$
$
Operating expenses:
Administrative expenses:
$
$
Selling expenses:
$
Total operating expenses
$

Solutions

Expert Solution

1.

Schedule of Cost of Goods manufactured
Direct Materials
Raw Material, Beginning Inventory $       296,600
Add: Purchases $       550,880
Total Raw Material Available $       847,480
Deduct : Raw Material in inventory, ending $       364,820
Raw Material used in production $       482,660
Direct Labor $       561,820
Manufacturing Overhead
Depreciation expense-factory equipment $          47,060
Heat, light, and power-factory $          18,610
Indirect Labor $          65,670
Property taxes-factory $          15,320
Rent expense-factory $          25,900
Supplies-factory $          12,770
Miscellaneous costs-factory $            8,030 $       193,360
Total Manufacturing Costs $    1,237,840
Add: Beginning Work in Process Inventory $       533,880
$    1,771,720
Deduct: Ending Work in Process Inventory $       496,160
Cost of Goods Manufactured $   1,275,560

2

Income Statement (Multi Step)
Net Sales Revenue $    2,579,280
Cost of Goods Sold
Beginning Finished Goods Inventory $       513,120
Cost of Goods Manufactured $    1,275,560
Cost of Goods Available for Sale $    1,788,680
Less : Ending Finished Goods Inventory $       507,100
Cost of Goods Sold $    1,281,580
Gross Profit $   1,297,700
Operating Expenses
Selling Expenses
Advertising Expense $       247,710
Sales Salaries Expense $       316,660
Total Selling Expenses $       564,370
Administrative Expenses
Depreciation Expense-office equipment $          35,020
Office salaries expense $       192,260
Property taxes-headquarters building $          31,740
Total Administrative Expenses $       259,020
Total Operating Expenses $       823,390
Net Operating Income $       474,310

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