Book problem. Incomplete manufacturing costs, expenses and selling data for two different cases are shown below: Required: 1. Indicate the missing amount for each letter 2. Prepare a schedule of cost of goods manufactured 3. Prepare a schedule of cost of goods sold 4. Prepare an income statement (Optional) Case 1 Case 2 Raw materials used 9,600 g) Direct labor cost 5,000 8,000 Total Factory overhead 8,000 4,000 Total Manufacturing costs a) 16,000 Beginning work in process inventory 1,000 h) Ending work in process inventory b) 3,000 Sales revenue 24,500 i) Sales discounts 2,500 1,400 Cost of goods manufactured 17,000 24,000 Beginning finished goods inventory c) 3,300 Goods available for sale 22,000 j) Cost of goods sold d) k) Ending finished goods inventory 3,400 2,500 Gross profit e) 7,000 Operating expenses 2,500 l) Net income f) 5,000
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Book problem. Incomplete
Required:
1. Indicate the missing amount for each letter
2. Prepare a schedule of cost of goods manufactured
3. Prepare a schedule of cost of goods sold
4. Prepare an income statement (Optional)
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Case 1 |
Case 2 |
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Raw materials used |
9,600 |
g) |
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Direct labor cost |
5,000 |
8,000 |
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Total Factory |
8,000 |
4,000 |
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Total Manufacturing costs |
a) |
16,000 |
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Beginning work in process inventory |
1,000 |
h) |
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Ending work in process inventory |
b) |
3,000 |
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Sales revenue |
24,500 |
i) |
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Sales discounts |
2,500 |
1,400 |
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Cost of goods manufactured |
17,000 |
24,000 |
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Beginning finished goods inventory |
c) |
3,300 |
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Goods available for sale |
22,000 |
j) |
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Cost of goods sold |
d) |
k) |
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Ending finished goods inventory |
3,400 |
2,500 |
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Gross profit |
e) |
7,000 |
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Operating expenses |
2,500 |
l) |
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Net income |
f) |
5,000 |
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