Chapter 14, Problem 12E

To determine

Cost of goods manufactured:

Cost of the goods manufactured is the cost that has been allocated to the materials or processes that are completed or still in process to be completed.

Overhead:

Overheads are the cost and the expenses a company incurs of the production of a particular goods or services which are not directly related to the production. It does not include labor and direct material.

To identify: The statements and prepare the schedule of cost of goods manufactured.

Explanation of Solution

Account	Balance sheet	Income statement	Schedule of cost of goods	Overhead report
Accounts receivable	?¾
Computer supplies used		?¾
Beginning finished goods inventory		?¾
Beginning work in process inventory			?¾
Cash	?¾
Depreciation expense – Factory building				?¾
Depreciation expense – office building		?¾
Direct labor			?¾
Ending work in process inventory	?¾		?¾
Ending raw materials inventory	?¾		?¾
Factory maintenance wages				?¾
Income taxes		?¾
Insurance on factory building				?¾
Property taxes on factory building				?¾
Raw material purchases			?¾
Sales		?¾
Table (1)

Computation of schedule of cost of goods manufactured and cost of goods sold,

Company Schedule for cost of goods manufactured for the year ended on
Particulars	Cost ($)
Direct Materials Cost
Beginning raw material inventory
Add: Raw material purchases
Raw materials available for use
Less: Ending raw materials inventory
Total direct materials used (A)
Direct labor (B)
Factory overhead
Add:
Rental cost on factory equipment
Factory utilities
Factory supplies used
Indirect labor
Repairs
Total factory overhead (C)
Total manufacturing cost $\left(\text{A}+\text{B}+\text{C}\right)$
Add: Beginning goods in process inventory
Total cost of goods in process
Less: Ending goods in process inventory
Cost of goods manufactured
Add: Beginning finished goods inventory
Goods available for sale
Less: Ending finished goods inventory
Cost of goods sold
Table (1)