Question

Schedule of Cost of Goods Manufactured and Sold

The following amounts are available for 2016 for Bourne Manufacturing Company:
Administrative salaries (non-factory) $105,000
Administrative rent (non-factory) 52,500
Advertising and promotion expense 61,500
Depreciation-administrative 33,000
Depreciation-factory 45,000
Depreciation-selling 25,500
Direct labor 262,500
Factory rent 27,000
Factory supplies used 18,000
Finished goods inventory (January 1) 85,500
Finished goods inventory (December 31) 78,000
Indirect material used 21,000
Indirect labor 28,500
Materials inventory (January 1) 19,500
Materials inventory (December 31) 30,000
Net delivered cost of materials purchased 207,000
Other factory overhead 39,000
Sales 1,267,500
Sales salaries expense 108,000
Work in process inventory (January 1) 27,000
Work in process inventory ( December 31) 46,500
Using the above data, prepare a schedule of cost of goods manufactured and sold.
Do not use negative signs with any of your answers.
Bourne Manufacturing Company
Schedule of Cost of Goods Manufactured and Sold
For the Year Ended December 31,2016
Direct material:
Beginning materials inventory Answer
Answer Answer
Cost of material available Answer
Less: Answer Answer
Total materials used Answer
Less: Answer Answer
Direct material used Answer
Direct labor Answer
Manufacturing overhead
Indirect material Answer
Indirect labor Answer
Factory supplies used Answer
Factory depreciation Answer
Factory rent Answer
Answer Answer
Total manufacturing overhead Answer
Total manufacturing costs for the year Answer
Add: Answer Answer
Total cost of work in process during the year Answer
Less: Answer Answer
Cost of goods manufactured Answer
Add: Answer Answer
Cost of goods available for sale Answer
Less: Answer Answer
Cost of goods sold Answer

Answer 1

Answer:

Cost of goods sold Answer 604,500

Step-by-step explanation:

Bourne Manufacturing Company

Schedule of Cost of Goods Manufactured and Sold

For the Year Ended December 31,2016

Direct material:

Beginning materials inventory Answer (January 1) 19,500

Net delivered cost of materials purchased 207,000

Cost of material available Answer : 226500

Less: Materials inventory (December 31) 30,000

Total materials used Answer 196500

Less: Indirect material used 21,000

Direct material used Answer 175,500

Direct labor Answer 262500

Manufacturing overhead

Other Factory Overhead 39000

Indirect material Answer 21000

Indirect labor Answer 28500

Factory supplies used Answer 18000

Factory depreciation Answer 45000

Factory rent Answer 27000

Total manufacturing overhead Answer 178500

Total manufacturing costs for the year Answer 616500

Add: Work in process inventory (January 1) 27,000

Total cost of work in process during the year 643,500

Less: Work in process inventory ( December 31) 46,500

Cost of goods manufactured 597000

Add: Finished goods inventory (January 1) 85,500

Cost of goods available for sale Answer 682,500

Less: Finished goods inventory (December 31) 78,000

Cost of goods sold Answer 604,500

We add and subtract the amounts according to the schedule.

In this schedule the indirect material is deducted from the direct materials inventory and added to the factory overhead because it is not treated as a direct expense rather it is an indirect expense.

The following are not related to the cost of manufacturing of products and are excluded from the CGS.

Administrative salaries (non-factory) $105,000

Administrative rent (non-factory) 52,500

Advertising and promotion expense 61,500

Depreciation-administrative 33,000

Depreciation-selling 25,500

Sales 1,267,500

Sales salaries expense 108,000

These are included in the net income statement.