with the following balances in its inventory accounts. urchased $125,000 of raw materials and issued $124,000 of materials to the production d amounted to $162,000, and manufacturing overhead of $24,000 was applied to Work in no over- or underapplied overhead. Goods costing $306,000 to produce were completed y. Goods costing $301,000 were sold for $400,000 during the period. Selling and 000. f the three inventory accounts that would appear on the year-end balance sheet. anufactured and sold.

Cornerstones of Cost Management (Cornerstones Series)
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ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
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Chapter2: Basic Cost Management Concepts
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Problem 22E: Ellerson Company provided the following information for the last calendar year: During the year,...
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5
Rockeagle Corporation began fiscal Year 2 with the following balances in its inventory accounts.
Raw Materials
Work in Process
$ 30,000
45,000
14,000
Finished Goods
Return to question
During the accounting period, Rockeagle purchased $125,000 of raw materials and issued $124,000 of materials to the production
department. Direct labor costs for the period amounted to $162,000, and manufacturing overhead of $24,000 was applied to Work in
Process Inventory. Assume that there was no over- or underapplied overhead. Goods costing $306,000 to produce were completed
and transferred to Finished Goods ventory. Goods costing $301,000 were sold for $400,000 during the period. Selling and
administrative expenses amounted to $36,000.
Required
a. Determine the ending balance of each of the three inventory accounts that would appear on the year-end balance sheet.
b1. Prepare a schedule of cost of goods manufactured and sold.
b2. Prepare an income statement.
Transcribed Image Text:5 Rockeagle Corporation began fiscal Year 2 with the following balances in its inventory accounts. Raw Materials Work in Process $ 30,000 45,000 14,000 Finished Goods Return to question During the accounting period, Rockeagle purchased $125,000 of raw materials and issued $124,000 of materials to the production department. Direct labor costs for the period amounted to $162,000, and manufacturing overhead of $24,000 was applied to Work in Process Inventory. Assume that there was no over- or underapplied overhead. Goods costing $306,000 to produce were completed and transferred to Finished Goods ventory. Goods costing $301,000 were sold for $400,000 during the period. Selling and administrative expenses amounted to $36,000. Required a. Determine the ending balance of each of the three inventory accounts that would appear on the year-end balance sheet. b1. Prepare a schedule of cost of goods manufactured and sold. b2. Prepare an income statement.
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