Primare Corporation has provided the following data concerning last month's manufacturing operations. A schedule of cost of goods sold for the month [check in attachment]
To calculate the cost of goods following formula:
manufactured, we need to use the
Cost of goods manufactured beginning
WIP + direct materials + direct labor + allocated manufacturing overhead -
Ending WIP
Schedule of Cost of Goods Manufactured
Direct materials:
Beginning raw material inventory $12,000
Add: Purchase of raw material
$30,000
Total raw materials available $42,000
Less: Ending raw material inventory $18,000
Raw material used in production $24,000
Raw material used in production $24,000Less: Indirect material
Raw material used in production $24,000
Less: Indirect material $5,000
$19,000
Direct labor cost $58,000
Manufacturing Overhead applied $87,000
Total manufacturing costs $164,000
Add: Beginning WIP Inventory
$56,000
Total cost of Work in Process $220,000
Less: Ending WIP Inventory $65,000
Cost of Goods manufactured.
Cost of Goods manufactured.$155000
Schedule of Cost of Goods Sold
Beginning Finished Goods Inventory $35,000
Add: Cost of Goods manufactured $155,000
Cost of Goods available for sale
Cost of Goods available for sale$190,000
Less: Ending finished goods inventory $42,000
Unadjusted Cost of Goods Sold
Unadjusted Cost of Goods Sold$148,000
Add: Under applied Overheads $4,000
Cost of Goods Sold [adjusted]
Cost of Goods Sold [adjusted]$144,000
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