Sleep Tight manufactures comforters. The estimated inventories on January 1 for finished goods, work in process, and materials were $37,000, $30,000 and $27,000 respectively. The desired inventories on December 31 for finished goods, work in process, and materials were $43,000, $35,000 and $22,000 respectively. Direct material purchases were $555,000. Direct labor was $250,000 for the year. Factory overhead was $143,000. Prepare a cost of goods sold budget for Sleep Tight, Inc. Sleep Tight, Inc. Cost of Goods Sold Budget For the Year Ending December 31 Finished goods inventory, January 1 $fill in the blank 1 Work in process inventory, January 1 $fill in the blank 2 Direct materials: Direct materials, January 1 $fill in the blank 3 Direct materials purchases fill in the blank 4 Cost of direct materials available for sale $fill in the blank 5 Less direct materials inventory, December 31 fill in the blank 6 Cost of direct materials placed in production $fill in the blank 7 Direct labor fill in the blank 8 Factory overhead fill in the blank 9 Total manufacturing costs fill in the blank 10 Total work in process during the period $fill in the blank 11 Less work in process inventory, December 31 fill in the blank 12 Cost of goods manufactured fill in the blank 13 Cost of finished goods available for sale $fill in the blank 14 Less finished goods inventory, December 31 fill in the blank 15 Cost of goods sold $fill in the blank 16
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Sleep Tight manufactures comforters. The estimated inventories on January 1 for finished goods, work in process, and materials were $37,000, $30,000 and $27,000 respectively. The desired inventories on December 31 for finished goods, work in process, and materials were $43,000, $35,000 and $22,000 respectively. Direct material purchases were $555,000. Direct labor was $250,000 for the year. Factory overhead was $143,000.
Prepare a cost of goods sold budget for Sleep Tight, Inc.
| Sleep Tight, Inc. | |||
| Cost of Goods Sold Budget | |||
| For the Year Ending December 31 | |||
| Finished goods inventory, January 1 | $fill in the blank 1 | ||
| Work in process inventory, January 1 | $fill in the blank 2 | ||
| Direct materials: | |||
| Direct materials, January 1 | $fill in the blank 3 | ||
| Direct materials purchases | fill in the blank 4 | ||
| Cost of direct materials available for sale | $fill in the blank 5 | ||
| Less direct materials inventory, December 31 | fill in the blank 6 | ||
| Cost of direct materials placed in production | $fill in the blank 7 | ||
| Direct labor | fill in the blank 8 | ||
| Factory overhead | fill in the blank 9 | ||
| Total |
fill in the blank 10 | ||
| Total work in process during the period | $fill in the blank 11 | ||
| Less work in process inventory, December 31 | fill in the blank 12 | ||
| Cost of goods manufactured | fill in the blank 13 | ||
| Cost of finished goods available for sale | $fill in the blank 14 | ||
| Less finished goods inventory, December 31 | fill in the blank 15 | ||
| Cost of goods sold | $fill in the blank 16 |
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