Compute cost of goods manufactured and cost of goods sold from the following amounts, using the equation method.  Begin                                       Beginning of the year           End of Year Direct materials inventory                   $22,000                     $26,000            Work in process inventory                  38,000                          30,000 Finished goods inventory                   18,000                          23,000 Purchases of direct materials                                                  75,000                                                                                                                             Direct labor                                                                              82,000                                                       Manufacturing overhead                                                          39,000

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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  1. Compute cost of goods manufactured and cost of goods sold from the following amounts, using the equation method.  Begin                                       Beginning of the year           End of Year

Direct materials inventory                   $22,000                     $26,000           

Work in process inventory                  38,000                          30,000

Finished goods inventory                   18,000                          23,000

Purchases of direct materials                                                  75,000                                                                                                                            

Direct labor                                                                              82,000                                                      

Manufacturing overhead                                                          39,000

2. Clyde’s Pets manufactures chewing bones for puppies. At the end of December 2008, his accounting records showed the following:

 Inventories                          Beginning                                      Ending

Materials                                $13,500                                         $9,000

Work in process                            0                                               1,250

Finished goods                             0                                               5,700

Other information:

Direct material purchases      $31,000     Utilities for plants         $4,500         

Plant janitorial service             1,250              Rent on plants          9,000

Sales salaries expense          5,000  Customer service hotline expense   1,000

 Delivery expense                    1,500              Direct labor                   18,000

Sales revenue                           105,000

 Requirements:

Prepare a schedule of cost of goods manufactured for the year ended December 31, 2008.

Prepare an income statement for Clyde’s Pets for the year ended December 31, 2008.

Given that the company manufactured 17,500 units, of its product in 2008, compute the company’s unit product cost for the year.

                                                

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