Question

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

Purchases of raw materials	$	32,000
Indirect materials included in manufacturing overhead	$	4,780
Direct labor	$	58,100
Manufacturing overhead applied to work in process	$	87,300
Underapplied overhead	$	4,040

Inventories	Beginning		Ending
Raw materials	$	10,700	$	18,700
Work in process	$	54,300	$	67,600
Finished goods	$	33,800	$	42,800

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.

Prepare a schedule of cost of goods manufactured for the month.

Primare Corporation Schedule of Cost of Goods Manufactured Direct materials: Beginning raw materials inventory $10,700 Add: Purchases of raw materials 32,000 Total raw materials available 42,700 Less: Ending raw materials inventory 187,000 Raw materials used in production 24,000 Less: Indirect materials included in manufacturing overhead $24,000 Direct labor 58,100 Manufacturing overhead applied to work in process 87,300 Total manufacturing costs 165,240 Add: Beginning work in process inventory 54,300 219,540 Less: Ending work in process inventory 67,600 Cost of goods manufactured

Prepare a schedule of cost of goods sold for the month. Assume the underapplied or overapplied overhead is closed to Cost of Goods Sold.

	Primare Corporation Schedule of Cost of Goods Sold Beginning finished goods inventory $33,800 Add: Cost of goods manufactured Cost of goods available for sale Less: Ending finished goods inventory Unadjusted cost of goods sold Add: Underapplied overhead Adjusted cost of goods sold

Answer 1

1)

Primare Corporation
Schedule of Cost of Goods Manufactured
Direct materials:
Beginning raw materials inventory	$ 10,700.00
Add: Purchases of raw materials	$ 32,000.00
Total raw materials available	$ 42,700.00
Less: Ending raw materials inventory	$ 18,700.00
Raw materials used in production	$ 24,000.00
Less: Indirect materials included in manufacturing overhead	$    4,780.00	$    19,220.00
Direct labor		$    58,100.00
Manufacturing overhead applied to work in process		$    87,300.00
Total manufacturing costs		$ 164,620.00
Add: Beginning work in process inventory		$    54,300.00
		$ 218,920.00
Less: Ending work in process inventory		$    67,600.00
Cost of goods manufactured		$ 151,320.00

2)

Primare Corporation
Schedule of Cost of Goods Sold
Beginning finished goods inventory	$    33,800.00
Add: Cost of goods manufactured	$ 151,320.00
Cost of goods available for sale	$ 185,120.00
Less: Ending finished goods inventory	$    42,800.00
Unadjusted cost of goods sold	$ 142,320.00
Add: Underapplied overhead	$      4,040.00
Adjusted cost of goods sold	$ 146,360.00