
Concept Introduction:
Schedule of cost of goods manufactured:
A schedule of cost of goods manufactured is a schedule explaining the flow of costs from raw material to the result as cost of goods manufactured for a period. The cost of goods manufactured amount if transferred to the finished goods inventory and is used to calculate cost of goods sold on income statement.
The schedule of cost of goods manufactured is as under −
Schedule of Cost of Goods manufactured | |||
Raw Material - Beginning | |||
Add: | Purchases of Raw material | ||
Less: | Raw Material - Ending | ||
Raw material consumed | |||
Add: | Direct labor | ||
Manufacturing | |||
Add: | Indirect labor | ||
Add: | Factory computer supplies used | ||
Add: | Repairs - Factory Equipment | ||
Rent Cost of factory building | |||
Total | |||
Add: | Working in Process inventory - Beginning | ||
Less: | Working in Process inventory - Ending | ||
Cost of Goods manufactured |
To prepare:
Schedule of cost of goods manufactured
Concept Introduction:
Cost of goods sold:
The cost of goods sold can be defined as the cost incurred in order to convert a raw material into finished goods. The cost of goods sold includes direct expenses i.e. direct material, direct labor and overheads like - variable manufacturing overheads and fixed manufacturing overhead as well. It is subtracted from the sales to know the gross profit of the business.
Cost of goods sold is calculated as under −
To compute:
Cost of Goods sold for the year

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Chapter 18 Solutions
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