Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies for the month of May: 1 Rainier Company Yakima Company 2 Materials inventory, May 1 $100,000.00 $48,200.00 3 Materials inventory, May 31 (a) 50,000.00 4 Materials purchased 950,000.00 710,000.00 5 Cost of direct materials used in production 938,500.00 (a) 6 Direct labor 2,860,000.00 (b) 7 Factory overhead 1,800,000.00 446,000.00 8 Total manufacturing costs incurred in May (b) 2,484,200.00 9 Total manufacturing costs 5,998,500.00 2,660,600.00 10 Work in process inventory, May 1 400,000.00 176,400.00 11 Work in process inventory, May 31 382,000.00 (c) 12 Cost of goods manufactured (c) 2,491,500.00 13 Finished goods inventory, May 1 615,000.00 190,000.00 14 Finished goods inventory, May 31 596,500.00 (d) 15 Sales 9,220,000.00 4,550,000.00 16 Cost of goods sold (d) 2,470,000.00 17 Gross profit (e) (e) 18 Operating expenses 1,000,000.00 (f) 19 Net income (f) 1,500,000.00 Required: a. Determine the amounts of the missing items, identifying them by letter. Enter all amounts as positive numbers. b. Prepare Yakima Company’s statement of cost of goods manufactured for May. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers use a minus sign. c. Prepare Yakima Company’s income statement for May. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Expenses should be positive.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies for the month of May:

1		Rainier Company	Yakima Company
2	Materials inventory, May 1	$100,000.00	$48,200.00
3	Materials inventory, May 31	(a)	50,000.00
4	Materials purchased	950,000.00	710,000.00
5	Cost of direct materials used in production	938,500.00	(a)
6	Direct labor	2,860,000.00	(b)
7	Factory overhead	1,800,000.00	446,000.00
8	Total manufacturing costs incurred in May	(b)	2,484,200.00
9	Total manufacturing costs	5,998,500.00	2,660,600.00
10	Work in process inventory, May 1	400,000.00	176,400.00
11	Work in process inventory, May 31	382,000.00	(c)
12	Cost of goods manufactured	(c)	2,491,500.00
13	Finished goods inventory, May 1	615,000.00	190,000.00
14	Finished goods inventory, May 31	596,500.00	(d)
15	Sales	9,220,000.00	4,550,000.00
16	Cost of goods sold	(d)	2,470,000.00
17	Gross profit	(e)	(e)
18	Operating expenses	1,000,000.00	(f)
19	Net income	(f)	1,500,000.00

	Required:
	a. Determine the amounts of the missing items, identifying them by letter. Enter all amounts as positive numbers.
	b. Prepare Yakima Company’s statement of cost of goods manufactured for May. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers use a minus sign.
	c. Prepare Yakima Company’s income statement for May. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Expenses should be positive.

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