The selected amounts that follow were taken from Sharon Corporation's accounting records: Raw material used P 27,000 Direct labor 35,000 Total manufacturing costs 104,000 Work-in-process inventory, 1/1 19,000 Cost of goods manufactured 100,000 Cost of goods available for sale 175,000 Finished-goods inventory, 12/31 60,000 Sales revenue 300,000 Selling and administrative expenses 125,000 Income tax expense 18,000 Required: Compute the following: A. Manufacturing overhead. B. Work-in-process inventory, 12/31. C. Finished-goods inventory, 1/1. D. Cost of goods sold. E. Gross margin. F. Net income.
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
2. The selected amounts that follow were taken from Sharon Corporation's accounting records:
Raw material used P 27,000
Direct labor 35,000
Total
Work-in-process inventory, 1/1 19,000
Cost of goods manufactured 100,000
Cost of goods available for sale 175,000
Finished-goods inventory, 12/31 60,000
Sales revenue 300,000
Selling and administrative expenses 125,000
Income tax expense 18,000
Required:
Compute the following:
A. Manufacturing
B. Work-in-process inventory, 12/31.
C. Finished-goods inventory, 1/1.
D. Cost of goods sold.
E. Gross margin.
F. Net income.
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