Question

Manufacturing Income Statement, Statement of Cost of Goods Manufactured

Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies for the month of December.

	On Company		Off Company
Materials inventory, December 1	$66,910		$84,310
Materials inventory, December 31	(a)		95,270
Materials purchased	169,950		(a)
Cost of direct materials used in production	179,320		(b)
Direct labor	252,250		189,700
Factory overhead	78,280		94,430
Total manufacturing costs incurred in December	(b)		545,490
Total manufacturing costs	638,320		748,680
Work in process inventory, December 1	128,470		203,190
Work in process inventory, December 31	108,390		(c)
Cost of goods manufactured	(c)		540,430
Finished goods inventory, December 1	113,080		94,430
Finished goods inventory, December 31	118,430		(d)
Sales	986,250		843,100
Cost of goods sold	(d)		545,490
Gross profit	(e)		(e)
Operating expenses	128,470		(f)
Net income	(f)		187,170

Required:

1. Determine the amounts of the missing items, identifying them by letter. Enter all amounts as positive numbers.

Letter	On Company	Off Company
a.	$	$
b.	$	$
c.	$	$
d.	$	$
e.	$	$
f.	$	$

2. Prepare On Company's statement of cost of goods manufactured for December.

On Company
Statement of Cost of Goods Manufactured
For the Month Ended December 31
			$
Direct materials:
	$
	$
		$
Total manufacturing costs incurred during December
Total manufacturing costs			$
			$

3. Prepare On Company's income statement for December.

On Company
Income Statement
For the Month Ended December 31
		$
Cost of goods sold:
	$
	$
		$
		$

Answer 1

1.

	On Company	Off Company
a.	$ 57,540	$ 272,320
b.	509,850	261,360
c.	519,930	208,250
d.	514,580	89,370
e.	471,670	297,610
f.	343,200	110,440

3.

On Company Income Statement For the month ended December 31
Sales	$ 986,250
Cost of Goods Sold	514,580
Gross Profit	471,670
Operating Expenses	128,470
Net Income	$ 343,200

Workings:

	On Company	Off Company
Materials Inventory, December 1	$ 66,910	$ 84,310
Materials Inventory, December 31	57,540	95,270
Materials Purchased	169,950	272,320
Cost of Direct Materials Used in Production	179,320	261,360
Direct Labor	252,250	189,700
Factory Overhead	78,280	94,430
Total Manufacturing Costs incurred in December	509,850	545,490
Total Manufacturing Costs	628,320	748,680
Work in Process Inventory, December 1	128,470	203,190
Work in Process Inventory, December 31	108,390	208,250
Cost of Goods Manufactured	519,930	540,430
Finished Goods Inventory, December 1	113,080	94,430
Finished Goods Inventory, December 31	118,430	89,370
Sales	986,250	843,100
Cost of Goods Sold	514,580	545,490
Gross Profit	471,670	297,610
Operating Expenses	128,470	110,440
Net Income	$ 343,200	$ 187,170