The following information has been taken from the Visic company’s production, sales & costrecords for the just completed year:Production in Units 30,000Sales in Units ?20000Ending finished goods inventory in units ? 10,000Sales in dollars 10,00,000Costs:Advertising 1,15,000Entertainment & travel 40,000Direct Labor 90,000Indirect Labor 85,000Raw materials purchased 500,000Building Rent (production uses 60% of the space; administrative &sales offices use the rest)40,000Utilities, factory 108,000Royalty paid for use of production patent,1.5 per unit produced ?Maintenance, factory 9,000Rent for special production equipment,11000 per year plus 0.30 perunit produced?Selling & administrative salaries 2,10,000Other factory overhead costs 6,800Other selling & administrative expenses 17,000Beginning of End ofPage 2 of 2the year YearInventories:Raw materials 40,000 20,000Work in process 60,000 30,000Finished goods 10,000 ?The finished goods inventory is being carried at the average unit production cost for the year. Theselling price of the product is tk. 50 per unit.Required:1. Prepare the statement of cost of goods sold.2. Prepare income statement for the year. 2. The following information has been taken from the Visic company's production, sales & cosrecords for the just completed year:Production in UnitsSales in Units30,000?20000Ending finished goods inventory in unitsSales in dollars? 10,00010,00,000Costs:Advertising1,15,00040,00090,00085,000500,00040,000Entertainment & travelDirect LaborIndirect LaborRaw materials purchasedBuilding Rent (production uses 60% of the space; administrative &sales offices use the rest)Utilities, factoryRoyalty paid for use of production patent,1.5 per unit producedMaintenance, factoryRent for special production equipment, 11000 per year plus 0.30 perunit producedSelling & administrative salariesOther factory overhead costsOther selling & administrative expenses108,000?9,000?2,10,0006,80017,000Beginning ofEnd ofPage 1 of 2 the yearYearInventories:Raw materialsWork in processFinished goods40,00020,00060,00030,00010,000?The finished goods inventory is being carried at the average unit production cost for the year. Theselling price of the product is tk. 50 perRequired:1. Prepare the statement of cost of goods sold.2. Prepare income statement for the year.unit.

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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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The following information has been taken from the Visic company’s production, sales & cost
records for the just completed year:
Production in Units 30,000
Sales in Units ?20000
Ending finished goods inventory in units ? 10,000
Sales in dollars 10,00,000
Costs:
Advertising 1,15,000
Entertainment & travel 40,000
Direct Labor 90,000
Indirect Labor 85,000
Raw materials purchased 500,000
Building Rent (production uses 60% of the space; administrative &
sales offices use the rest)

40,000
Utilities, factory 108,000
Royalty paid for use of production patent,1.5 per unit produced ?
Maintenance, factory 9,000
Rent for special production equipment,11000 per year plus 0.30 per
unit produced

?
Selling & administrative salaries 2,10,000
Other factory overhead costs 6,800
Other selling & administrative expenses 17,000
Beginning of End of

Page 2 of 2

the year Year

Inventories:
Raw materials 40,000 20,000
Work in process 60,000 30,000
Finished goods 10,000 ?
The finished goods inventory is being carried at the average unit production cost for the year. The
selling price of the product is tk. 50 per unit.
Required:
1. Prepare the statement of cost of goods sold.
2. Prepare income statement for the year.

2. The following information has been taken from the Visic company's production, sales & cos
records for the just completed year:
Production in Units
Sales in Units
30,000
?20000
Ending finished goods inventory in units
Sales in dollars
? 10,000
10,00,000
Costs:
Advertising
1,15,000
40,000
90,000
85,000
500,000
40,000
Entertainment & travel
Direct Labor
Indirect Labor
Raw materials purchased
Building Rent (production uses 60% of the space; administrative &
sales offices use the rest)
Utilities, factory
Royalty paid for use of production patent,1.5 per unit produced
Maintenance, factory
Rent for special production equipment, 11000 per year plus 0.30 per
unit produced
Selling & administrative salaries
Other factory overhead costs
Other selling & administrative expenses
108,000
?
9,000
?
2,10,000
6,800
17,000
Beginning of
End of
Page 1 of 2

the year
Year
Inventories:
Raw materials
Work in process
Finished goods
40,000
20,000
60,000
30,000
10,000
?
The finished goods inventory is being carried at the average unit production cost for the year. The
selling price of the product is tk. 50 per
Required:
1. Prepare the statement of cost of goods sold.
2. Prepare income statement for the year.
unit.

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