Question

Primare Corporation has provided the following data concerning last month’s manufacturing operations.

 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

Primare Corporation
Schedule of Cost of Goods Manufactured
Direct Materials:
Beginning raw materials inventory	$11,300
Add: Purchases of raw materials	$32,000
Total raw materials available	$43,300
Less: Ending raw materials inventory	$19,600
Raw materials used in production	$23,700
Less: Indirect material included in manufacturing overhead	$4,940	$18,760
Direct labor		$59,900
Manufacturing overhead applied to work in process		$87,400
Total manufacturing costs        [$18,760 + $59,900 + $87,400]		$166,060
Add: Beginning work in process inventory		$55,000
		$221,060
Less: Ending work in process inventory		$66,200
Cost of Goods Manufactured		$154,860

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Primare Corporation
Schedule of Cost of Goods Sold
Beginning finished goods inventory	$33,700
Add: Cost of Goods Manufactured                       [Refer schedule of Cost of Goods Manufactured]	$154,860
Cost of goods available for sale	$188,560
Less: Ending finished goods inventory	$42,200
Unadjusted cost of goods sold	$146,360
Add: Underapplied overhead	$4,160
Adjusted cost of goods sold	$150,520