Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials): • Selling expenses - $212,000 • Purchases of raw materials - $261,000 • Direct labor - ? • Administrative expenses - $156,000 • Manufacturing overhead applied to work in process - $367,000 • Actual manufacturing overhead cost - $353,000 Beginning and ending inventory balances were as follows: Beginning of Year End of Year Raw materials $54,000 Work in process? Finished goods $39,000 $32,000 $32,000 ? The total manufacturing costs added to production for the year were $670,000; the cost of goods available for sale totaled $745,000; the unadjusted cost of goods sold totaled $669,000; and the net operating income was $40,000. The company's underapplied or overapplied overhead is close to the Cost of Goods Sold. Prepare schedules of cost of goods manufactured and cost of goods sold and an income statement. (Hint: Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.)

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
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Author:Don R. Hansen, Maryanne M. Mowen
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Chapter2: Basic Cost Management Concepts
Section: Chapter Questions
Problem 22E: Ellerson Company provided the following information for the last calendar year: During the year,...
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Superior Company provided the following data for the year ended December 31 (all raw
materials are used in production as direct materials):
• Selling expenses - $212,000
• Purchases of raw materials - $261,000
• Direct labor - ?
• Administrative expenses - $156,000
• Manufacturing overhead applied to work in process - $367,000
• Actual manufacturing overhead cost - $353,000
Beginning and ending inventory balances were as follows:
Beginning of Year End of Year
Raw materials
$54,000
Work in process?
Finished goods $39,000
$32,000
$32,000
?
The total manufacturing costs added to production for the year were $670,000; the cost
of goods available for sale totaled $745,000; the unadjusted cost of goods sold totaled
$669,000; and the net operating income was $40,000. The company's underapplied or
overapplied overhead is close to the Cost of Goods Sold.
Prepare schedules of cost of goods manufactured and cost of goods sold and an income
statement. (Hint: Prepare the income statement and schedule of cost of goods sold first
followed by the schedule of cost of goods manufactured.)
Transcribed Image Text:Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials): • Selling expenses - $212,000 • Purchases of raw materials - $261,000 • Direct labor - ? • Administrative expenses - $156,000 • Manufacturing overhead applied to work in process - $367,000 • Actual manufacturing overhead cost - $353,000 Beginning and ending inventory balances were as follows: Beginning of Year End of Year Raw materials $54,000 Work in process? Finished goods $39,000 $32,000 $32,000 ? The total manufacturing costs added to production for the year were $670,000; the cost of goods available for sale totaled $745,000; the unadjusted cost of goods sold totaled $669,000; and the net operating income was $40,000. The company's underapplied or overapplied overhead is close to the Cost of Goods Sold. Prepare schedules of cost of goods manufactured and cost of goods sold and an income statement. (Hint: Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.)
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