The following data from the just completed year are taken from the accounting records of Mason Company: Sales$655,000Direct labor cost$87,000Raw material purchases$131,000Selling expenses$101,000Administrative expenses$41,000Manufacturing overhead applied to work in process$203,000Actual manufacturing overhead costs$225,000 InventoriesBeginningEndingRaw materials$8,000$10,500Work in process$5,900$20,900Finished goods$72,000$25,300 Required:1. Prepare a schedule of cost of goods manufactured. Assume all raw materials used in production were direct materials.2. Prepare a schedule of cost of goods sold. Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold.3. Prepare an income statement.

Answered: The following data from the just…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter4: Job Order Costing

Section: Chapter Questions

Problem 6PB: During the year, a company purchased raw materials of $77,321 and incurred direct labor costs of...

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The following data from the just completed year are taken from the accounting records of Mason Company:


Sales	$	655,000
Direct labor cost	$	87,000
Raw material purchases	$	131,000
Selling expenses	$	101,000
Administrative expenses	$	41,000
Manufacturing overhead applied to work in process	$	203,000
Actual manufacturing overhead costs	$	225,000

Inventories	Beginning	Ending
Raw materials	$	8,000	$	10,500
Work in process	$	5,900	$	20,900
Finished goods	$	72,000	$	25,300

Required:

1. Prepare a schedule of cost of goods manufactured. Assume all raw materials used in production were direct materials.

2. Prepare a schedule of cost of goods sold. Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold.

3. Prepare an income statement.

Expert Solution

Step 1:

First, we need to complete the schedule of cost of goods manufactured and then after we can prepare the schedule of cost of goods sold.

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