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	$	4,660
Direct labor	$	59,200
Manufacturing overhead applied to work in process	$	88,000
Underapplied overhead	$	4,060

Inventories	Beginning		Ending
Raw materials	$	10,400	$	18,400
Work in process	$	55,600	$	65,100
Finished goods	$	33,300	$	43,000

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

	Schedule of Cost of Goods Manufactured
	Particulars			Amount
	Raw Materials:
		Beginning R.M inventory			$ 10,400.00
	Add:	Purchase			$ 30,000.00
	Less:	Ending R.M inventory			$ 18,400.00
		R.M used in production			$ 22,000.00
	Less:	Indirect Materials			$   4,660.00
	Direct Materials					$   17,340.00
	Direct Labor					$   59,200.00
	Manu. OH applied					$   88,000.00
	Total Manufacturing Cost					$ 164,540.00
Add:	Beginning WIP					$   55,600.00
Less:	Ending WIP					$   65,100.00
	Cost of Goods Manufactured					$ 155,040.00

	Schedule of Cost of Goods Sold
	Particulars			Amount
	Beginning Finished Goods			$   33,300.00
Add:	Cost of Goods Manufactured			$ 155,040.00
Less:	Ending Finished Goods			$   43,000.00
	Unadjusted Cost of Goods sold			$ 145,340.00
Add:	Underapplied OH			$     4,060.00
	Cost of Goods Sold			$ 149,400.00