Grant McClellan Company Company $86,380 $118,340 (a)133,720 266,270 Materials in

Question

Grant McClellan Company Company $86,380 $118,340 (a)133,720 266,270 Materials inventory, December 1 Materials inventory, December 31 Materials purchased Cost of direct materials used in production Direct labor Factory overhead Total manufacturing costs incurred during December Total manufacturing costs Work in process inventory, December 1 Work in process inventory, December 31 Cost of goods manufactured Finished goods inventory, December 1 Finished goods inventory, December 31 Sales Cost of goods sold Gross profit Operating expenses Net income 219,410 231,500 325,650 101,060 132,540 (b)765,660 824,060 1,050,860 285,200 165,850 139,940 (c)758,560 145,980 132,540 152,890 1,273,2401,183,400 (d)765,660 165,850 (f)262,710

Explanation / Answer

1) Grant Company a) Materials Inventory , December 1 86380 Add Purchases 219410 Less : Cost of direct materials used in production 231500 Materials inventory , December 31 (a) 74290 b) Cost of direct materials used in production 231500 Add : Direct labor 325650 Add : Factory overhead 101060 Total manufacturing cost incurred during December (b) 658210 c) Work in process inventory , December 1 165850 Add: manufactured cost incurred during December 658210 Less : Work in process inventory , December 31 139940 Cost of goods manufactured 684120 d) Finished goods inventory , December 1 145980 Add : Cost of goods manufactured 684120 Less : Finished goods inventory , December 31 152890 Cost of goods sold 677210 e) Sales 1273240 Less : Cost of goods sold 677210 Gross Profit (e) 596030 f) Gross Profit 596030 Less : operating expenses 165850 Net Income 430180 McClellan Company a) Materials Inventory , December 1 118340 Add Purchases 266270 Less : materials inventory , December 31 133720 Cost of direct materials used in production (a) 250890 b) Total manufacturing cost incurred during December 765660 Less : Cost of direct materials used in production 250890 Less: Factory overhead 132540 Direct labor 382230 c) Total manufacturing cost incurred during December 765660 Add : work in process inventory , December 1 285200 Less : Cost of goods manufactured 758560 Work in process , December 31 292300 d) Cost of goods manufactured 758560 Add : finished goods inventory , December 1 132540 Less : Cost of goods sold 765660 Finished goods inventory , December 31 125440 e) Sales 1183400 Less : Cost of goods sold 765660 Gross Profit 417740 f) Gross Profit 417740 Less : Net Income 262710 Operating expenses 155030 2) McClellan Company Statement of cost of goods manufactured Work in process , December 1 285200 Direct materials Materials inventory , December 1 118340 Add : Materials purchased 266270 Less : Materials inventory , December 31 133720 Cost of direct materials used in production (a) 250890 Direct labor 382230 Factory overhead 132540 Total manufacturing costs incurred during December 765660 Total manufacturing costs 1050860 Less : Work in progress December 31 292300 Cost of goods manufactured 758560 3) Income Statement Sales 1183400 Finished goods inventory , December 1 132540 Cost of goods manufactured 758560 Less : finished goods inventory , December 31 125440 Cost of goods sold 765660 Gross Profit 417740 Less : operating expenses 155030 Net Income 262710

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