1. Holstein Family Company had the following account balances for the quarter en
ID: 2392873 • Letter: 1
Question
1. Holstein Family Company had the following account balances for the quarter ending March 31, 2018: Direct materials purchases Direct labor Factory overhead Sales Selling and administrative expenses $325,000 190,000 175,000 1,100,000 192,000 Direct materials inventory Work-in-process inventory Finished goods inventory January 1 $25,000 43,000 71,000 March 31 $29,000 43,000 62,000 Required (assume no income taxes): a. b. c. d. e. f. What was the amount of direct materials used for the quarter? What was the amount of cost of goods manufactured for the quarter? What was the amount of cost of goods sold for the quarter? What was the net income for the quarter? What was the amount of conversion costs incurred for the quarter? What was the amount of prime costs incurred for the quarter?Explanation / Answer
a) Direct material used = 25000+325000-29000 = 321000
b) Cost of goods manufactured = 321000+190000+175000+43000-43000 = $686000
c) Cost of goods sold = 686000+71000-62000 = $695000
d) Net income = 1100000-695000-192000 = $213000
e) Conversion cost = 190000+175000 = $365000
f) Prime cost = 321000+190000 = $511000
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