Prepare a schedule of cost of goods manufactured for Gourmet Bones for the year ended December 31 2018. Goirmet Bones manufactured 17,900 units of its product in 2018. Compare the company's unit product cost for the year, rounded to the nearest cent.

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Prepare a schedule of cost of goods manufactured for Gourmet Bones for the year ended December 31 2018. Goirmet Bones manufactured 17,900 units of its product in 2018. Compare the company's unit product cost for the year, rounded to the nearest cent.
Introduction to Managerial Accounting 895
P16-28A Preparing a schedule of cost of goods manufactured and an income
statement for a manufacturing company
Learning Objective 3
Gourmet Bones manufactures its own brand of pet chew bones. At the end of
December 2018, the accounting records showed the following:
2. Operating income: $23,200
Balances:
Beginning
Ending
Direct Materials
$ 13,500
$ 7,500
Work-in-Process Inventory
3,500
Finished Goods Inventory
5,200
Other information:
Direct materials purchases
$ 36,000
Plant janitorial services
700
Sales salaries
6,000
Delivery costs
1,300
Net sales revenue
107,000
Utilities for plant
1,300
Rent on plant
17,000
Customer service hotline costs
1,200
Direct labor
23,000
Requirements
1. Prepare a schedule of cost of goods manufactured for Gourmet Bones for the
year ended December 31, 2018.
2. Prepare an income statement for Gourmet Bones for the year ended December
31, 2018.
3. How does the format of the income statement for Gourmet Bones differ from the
income statement of a merchandiser?
4. Gourmet Bones manufactured 17,900 units of its product in 2018. Compute the
company's unit product cost for the year, rounded to the nearest cent.
CHAPTER 16
Transcribed Image Text:Introduction to Managerial Accounting 895 P16-28A Preparing a schedule of cost of goods manufactured and an income statement for a manufacturing company Learning Objective 3 Gourmet Bones manufactures its own brand of pet chew bones. At the end of December 2018, the accounting records showed the following: 2. Operating income: $23,200 Balances: Beginning Ending Direct Materials $ 13,500 $ 7,500 Work-in-Process Inventory 3,500 Finished Goods Inventory 5,200 Other information: Direct materials purchases $ 36,000 Plant janitorial services 700 Sales salaries 6,000 Delivery costs 1,300 Net sales revenue 107,000 Utilities for plant 1,300 Rent on plant 17,000 Customer service hotline costs 1,200 Direct labor 23,000 Requirements 1. Prepare a schedule of cost of goods manufactured for Gourmet Bones for the year ended December 31, 2018. 2. Prepare an income statement for Gourmet Bones for the year ended December 31, 2018. 3. How does the format of the income statement for Gourmet Bones differ from the income statement of a merchandiser? 4. Gourmet Bones manufactured 17,900 units of its product in 2018. Compute the company's unit product cost for the year, rounded to the nearest cent. CHAPTER 16
Expert Solution
Step 1

Raw materials: It is the basic input required to manufacture the finished products. The raw materials are processed by incurring conversion costs and other overhead to convert them into finished products.

Manufacturing overhead: It is the indirect cost incurred as a part of manufacturing the products. These costs are not directly related to the units manufactured. So they are allocated to the manufactured units based on estimated cost drivers.

Work-in process: This is the cost of units which were semi-finished in a particular period. Further work should be done and cost should be incurred to make them into finished products.

Finished goods: These are the units which were completed by the manufacturing process and were ready to sale.

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