Several items are omitted from the income statement and cost of goods manufactur
ID: 2565318 • Letter: S
Question
Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies for the month of December 2016:
1
Prius Company
Volt Company
2
Materials inventory, December 1
$281,680.00
$179,000.00
3
Materials inventory, December 31
(a)
175,500.00
4
Materials purchased
714,000.00
341,500.00
5
Cost of direct materials used in production
752,400.00
(a)
6
Direct labor
1,058,800.00
(b)
7
Factory overhead
325,400.00
178,600.00
8
Total manufacturing costs incurred during December
(b)
1,038,000.00
9
Total manufacturing costs
2,677,200.00
1,481,500.00
10
Work in process inventory, December 1
540,600.00
443,500.00
11
Work in process inventory, December 31
453,200.00
(c)
12
Cost of goods manufactured
(c)
1,025,500.00
13
Finished goods inventory, December 1
477,800.00
201,500.00
14
Finished goods inventory, December 31
496,400.00
(d)
15
Sales
4,140,000.00
1,678,000.00
16
Cost of goods sold
(d)
1,042,000.00
17
Gross profit
(e)
(e)
18
Operating expenses
543,000.00
(f)
19
Net income
(f)
380,500.00
Amount Descriptions
Starting Question
A. Determine the amounts of the missing items, identifying them by letter. Enter all amounts as positive numbers.
Statement of Cost of Goods Manufactured
B. Prepare Volt Company’s statement of cost of goods manufactured for December. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. “Less” or “Plus” will automatically appear if it is required. Enter all amounts as positive numbers.
Volt Company
Statement of Cost of Goods Manufactured
For the Month Ended December 31, 2016
1
2
Direct materials:
3
4
5
6
7
8
9
10
11
Total manufacturing costs
12
13
Income Statement
C. Prepare Volt Company’s income statement for December. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. “Less” or “Plus” will automatically appear if it is required. Enter all amounts as positive numbers.
Volt Company
Income Statement
For the Month Ended December 31, 2016
1
2
Cost of goods sold:
3
4
5
6
7
8
9
10
1
Prius Company
Volt Company
2
Materials inventory, December 1
$281,680.00
$179,000.00
3
Materials inventory, December 31
(a)
175,500.00
4
Materials purchased
714,000.00
341,500.00
5
Cost of direct materials used in production
752,400.00
(a)
6
Direct labor
1,058,800.00
(b)
7
Factory overhead
325,400.00
178,600.00
8
Total manufacturing costs incurred during December
(b)
1,038,000.00
9
Total manufacturing costs
2,677,200.00
1,481,500.00
10
Work in process inventory, December 1
540,600.00
443,500.00
11
Work in process inventory, December 31
453,200.00
(c)
12
Cost of goods manufactured
(c)
1,025,500.00
13
Finished goods inventory, December 1
477,800.00
201,500.00
14
Finished goods inventory, December 31
496,400.00
(d)
15
Sales
4,140,000.00
1,678,000.00
16
Cost of goods sold
(d)
1,042,000.00
17
Gross profit
(e)
(e)
18
Operating expenses
543,000.00
(f)
19
Net income
(f)
380,500.00
Explanation / Answer
A.Determine the amounts of the missing items, identifying them by letter. Enter all amounts as positive numbers. Prius Company Volt Company Materials inventory, December 1 $281,680 $179,000 Materials inventory, December 31 $243,280 $175,500 Materials purchased $714,000 $341,500 Cost of direct materials used in production (a) $752,400 $345,000 Direct labor (b) $1,058,800 $514,400 Factory overhead (c) $325,400 $178,600 Total manufacturing costs incurred during December d =(a + b+ c) $2,136,600 $1,038,000 Total manufacturing costs $2,677,200 $1,481,500 Work in process inventory, December 1 (e) 540600 443500 Work in process inventory, December 31 (f) 453200 $456,000 Cost of goods manufactured g = (d + e -f) $2,224,000 $1,025,500 Finished goods inventory, December 1 (h) $477,800 $201,500 Finished goods inventory, December 31 (i) $496,400 $185,000 Sales $4,140,000 $1,678,000 Cost of goods sold j = (g + h - i) $1,438,200 $1,042,000 Gross profit $2,701,800 $636,000 Operating expenses $543,000 $255,500 Net income $2,158,800 $380,500 a) a) Raw materials inventory, beginning $281,680 Raw materials inventory, beginning $179,000 Direct materials purchased $714,000 Direct materials purchased $341,500 Less: Cost of direct materials used in production $752,400 Less Raw materials inventory, ending $175,500 Raw materials inventory, ending $243,280 Cost of direct materials issued to production $345,000 b) ($752,400 + $1,058,400 + $325,400) $2,136,600
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