The following data (in thousands of dollars) have been taken from the accounting

Question

The following data (in thousands of dollars) have been taken from the accounting record: of Charlotte Corporation for the year ended December 31, 2009. Sales $960 Purchases of raw materials 170 Direct labor 220 Factory supervisor's salary 70 Depreciation - Factory equipment 50 Factory insurance 13 Administrative expenses 120 Indirect labor 30 Factory utilities 20 Selling expenses 170 Factory maintenance 15 Misc. Factory costs 12 Raw materials inventory - January 1, 2009 10 Raw materials inventory - December 31, 2009 50 Work in process inventory - January 1, 2009 80 Work in process inventory - December 31, 2009 60 100 Prepare a Schedule of Cost of Goods Manufactured. Prepare an Income Statement, including the calculation of Cost of Goods Sold

Explanation / Answer

b. Income statement:

cost of goods sold : Beginning inventory of finished goods+cost of goods manufactured = finished goods available for sale

finished goods available for sale - ending finished goods = cost of goods sold.

110+760 - 100 = 770

Direct materials used Beginning raw materials 10 Add: cost of raw materials purchased 170 Total raw materials available 180 Less: ending raw materials inventory (50) Total raw materials used 310 Direct labor 220 Factory overhead Supervisor's salary 70 Depreciation 50 Insurance 13 Indirect labor 30 Factory utilities 20 Maintenance 15 Misc factory costs 12 Total factory overhead 210 Total manufacturing costs 740 Add: beginning WIP 80 less: ending WIP (60) Cost of goods manufactured 760

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