The Devon Motor Company produces automobiles. On April 1st the company had no be

Question

The Devon Motor Company produces automobiles. On April 1st the company had no beginning inventories and it purchased 5740 batteries at a cost of $65 per battery. It withdrew 5,300 batteries from the storeroom during the month. Of these, 100 were used to replace batteries in cars being used by the company's traveling sales staff. The remaining 5,200 batteries withdrawn from the storeroom were placed in cars being produced by the company. Of the cars in production during April, 90 percent were completed and transferred from work in process to finished goods. Of the cars completed during the month, 30 percent were unsold at April 30th Required: 1. Determine the cost of batteries that would appear in each of the following accounts on April 30th. Cost

Explanation / Answer

1a.) cost of raw materials inventory at April 30:-

1b.) cost in work in process inventory at April 30 :-

1c.) Cost in finished goods inventory at April 30 :-

1d.) Cost of goods sold :-

1e.) Selling expenses :-

Particulars Qty. Batteries purchased (A) 5740 Less : withdrawn from inventory (B) -5300 Batteries remaining in inventory (A-B) =C 440 Cost of battery (D) 65 Cost in raw materials inventory at April 30 ( C*D ) 28600

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