The following information relates to the year ending 30th June 2017: Medical Technology Ltd. £ Sales (16,000 monitors) 975,000 Selling and administrative salaries 90,000 Advertising 200,000 Cleaning supplies, factory 6,000 Indirect labour costs 135,000 Depreciation, office equipment 18,000 Direct labour costs 80,000 Raw materials purchased 310,000 Maintenance, factory 47,000 Rental cost facilities 60,000 Insurance, factory 9,000 Utilities 45,000 Depreciation, production equipment 75,000 Travel, salespersons 60,000 The following additional information is available on the company’s activities during the quarter ended June 30: (i) Inventories at the beginning and end of the quarter were as follows: Inventory Beg. of the Quarter End of the Quarter Raw materials £0 £40,000 Work in process £0 £30,000 Finished goods £0 4000 units (ii) 80% of the rental cost for facilities and 90% of the utilities cost relate to manufacturing operations. The remaining amounts relate to selling and administrative activities. (iii) The company produced 20,000 units during the quarter; Questions: Prepare a schedule of cost of goods manufactured for the quarter. Prepare an income statement for the quarter. Your statement should show in detail how the cost of goods sold is computed.
The following information relates to the year ending 30th June 2017:
|
Medical Technology Ltd. |
£ |
|
Sales (16,000 monitors) |
975,000 |
|
Selling and administrative salaries |
90,000 |
|
Advertising |
200,000 |
|
Cleaning supplies, factory |
6,000 |
|
Indirect labour costs |
135,000 |
|
|
18,000 |
|
Direct labour costs |
80,000 |
|
Raw materials purchased |
310,000 |
|
Maintenance, factory |
47,000 |
|
Rental cost facilities |
60,000 |
|
Insurance, factory |
9,000 |
|
Utilities |
45,000 |
|
Depreciation, production equipment |
75,000 |
|
Travel, salespersons |
60,000 |
The following additional information is available on the company’s activities during the quarter ended June 30:
(i) Inventories at the beginning and end of the quarter were as follows:
|
Inventory |
Beg. of the Quarter |
End of the Quarter |
|
Raw materials |
£0 |
£40,000 |
|
Work in process |
£0 |
£30,000 |
|
Finished goods |
£0 |
4000 units |
(ii) 80% of the rental cost for facilities and 90% of the utilities cost relate to manufacturing operations. The remaining amounts relate to selling and administrative activities.
(iii) The company produced 20,000 units during the quarter;
Questions:
-
Prepare a schedule of cost of goods manufactured for the quarter.
-
Prepare an income statement for the quarter. Your statement should show in detail how the cost of goods sold is computed.
Step by step
Solved in 2 steps with 2 images
