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.
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.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
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 |
$ | 203,000 |
| Actual |
$ | 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.
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 3 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education