The Zoe Corporation has the following information for the month of March. Prepar

Question

The Zoe Corporation has the following information for the month of March. Prepare a (a) schedule of cost of goods manufactured, (b) an income statement for the month ended March 31, and (c) prepare only the inventory section of the balance sheet.

Purchases $92,000
Materials inventory, March 1 6,000
Materials inventory, March 31 8,000
Direct labor 25,000
Factory overhead 37,000
Work in process, March 1 22,000
Work in process, March 31 18,500
Finished goods inventory, March 1 21,000
Finished goods inventory, March 31 25,000
Sales 257,000
Sales and administrative expenses 79,000

Explanation / Answer

a. Cost of goods manufactured

Direct materials

Beginning inventory

6000

purchases

92000

available for use

98000

ending

8000

direct materials used

90000

Direct manufacturing labor

25000

Factory overhead

37000

manufaturing costs incurred

152000

plus beginning wip

22000

costs to account for

174000

less ending wip

18500

cost of goods mnaufactured

155500

b. Income statement

revenues

257000

cost of goods sold:

beginning finished inventory

21000

plus cost of goods manufactured

155500

cost of goods available fo sale

176500

less ending finished goods inventory

25000

cost of goods sold

151500

gross margin

105500

selling and admin

79000

operating income

26500

c. Balance sheet

Inventory:

Materials inventory

8,000

Work in process inventory

18,500

Finished goods inventory

25,000

51,500

a. Cost of goods manufactured

Direct materials

Beginning inventory

6000

purchases

92000

available for use

98000

ending

8000

direct materials used

90000

Direct manufacturing labor

25000

Factory overhead

37000

manufaturing costs incurred

152000

plus beginning wip

22000

costs to account for

174000

less ending wip

18500

cost of goods mnaufactured

155500

b. Income statement

revenues

257000

cost of goods sold:

beginning finished inventory

21000

plus cost of goods manufactured

155500

cost of goods available fo sale

176500

less ending finished goods inventory

25000

cost of goods sold

151500

gross margin

105500

selling and admin

79000

operating income

26500

c. Balance sheet

Inventory:

Materials inventory

8,000

Work in process inventory

18,500

Finished goods inventory

25,000

51,500

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