At the end of January 2018, the accounting information system of Historic Instru

Question

At the end of January 2018, the accounting information system of Historic Instruments revealed the following amounts:

-Total manufacturing costs incurred in January 2018, $180

-purchases of direct materials on account, $50

-purchases of direct materials for cash, $12

-ending work in process, $15   

-Ending inventory of direct materials, $22

-Ending finished goods inventory, $50

-Direct labor incurred, $70

-Cost of goods manufactured in Janury 2018, $183

-Cost of goods available for sale, $220

-Cost of direct materials used, $80

-Beginning work in process, $18

Calculate the following amounts

1) Beginning inventory of direct material

2) Total factory overhead

3) Total manufacturing costs

4) Beginning inventory of finished goods

5) Cost of goods sold

Explanation / Answer

1 Cost of direct material used 80 Add: Closing inventory of Raw material 22 Less: Purchases of Raw material 62 (50+12) Opening Raw material inventory 40 2 Total maufacturing cost incurred in Jan 180 Less: Raw material used 80 Less: Direct labour incurred 70 Factory overhead 30 3 Total manufacturing cost Raw material used 80 Add: Direct labour incurred 70 Add: Factory overhead 30 Total manufacturing cost 180 4 Cost of goods available for sale 220 Less: Cost of goods mnufactured in Jan 183 Opening Finished goods inventory 37 5 Cost of goods available 220 Less: Closing invemtory of Finished goods 50 Cost of goods sold 170

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