Schedule of Cost of Goods Manufactured Crunchem Cereal Company incurred the foll

Question

Schedule of Cost of Goods Manufactured Crunchem Cereal Company incurred the following actual costs during 20 times 1. The firm's predetermined overhead rate is 210percent of direct-labor cost. The January I inventory balances were as follows: Each of these inventory balances was 10 percent higher at the end of the year. Required: Prepare a schedule of cost of goods manufactured for 20 times 1. What was the cost of goods sold for the year? Build a spreads heet: Construct an Excel spreadsheet to solve all of the preceding requirements. Show how the solution will change if the following data change: direct material used amounted to $281,000 and raw-material inventory on December 31was $28,000. Schedule of Cost of goods manufactured for 20 times 1: Raw material available for use = Raw material Inventory on January 01 + Material is used during 20 times 1. Total Manufacturing Cost = Raw material consumed + Direct Labor + Manufacturing Overheads

Explanation / Answer

Hi, Please find the answer as follows: Part A: Raw-material Used = 275000 Direct labor = 120000 Manufacturing overhead = 252000 Total manufacturing costs = 647000 Add: Work-in-process inventory, January 1 = 39000 Less: Work-in-process inventory, December 31 = 39000*(1+.10) = 42900 Cost of goods manufactured = 647000 + 39000 - 42900 = 643100 (yes, you are correct). Part B: Finished-goods inventory, January 1 = 42000 Add: Cost of goods manufactured = 643100 Cost of goods available for sale = 685100 Less: Finished-goods inventory, December 31 = 42000*(1+.10) = 46200 Cost of goods sold = 638900 Part C: Cost of Goods Manufactured Raw-material Used = 281000 Direct labor = 120000 Manufacturing overhead = 252000 Total manufacturing costs = 653000 Add: Work-in-process inventory, January 1 = 39000 Less: Work-in-process inventory, December 31 = 39000*(1+.10) = 42900 Cost of goods manufactured = 653000 + 39000 - 42900 = 649100 Cost of Goods Sold Finished-goods inventory, January 1 = 42000 Add: Cost of goods manufactured = 649100 Cost of goods available for sale = 691100 Less: Finished-goods inventory, December 31= 42000*(1+.10) = 46200 Cost of goods sold = 644900 Thanks.

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