ACCOUNTING

Managerial Accounting 1B

Financial and Managerial Accounting

Chapter 14

 

1.

 

 

Exercise 14-8 Cost of goods sold computation L.O. P1

  Century
Merchandising
  New Homes
Manufacturing
 
  Beginning inventory                
     Merchandise   $ 250,000            
     Finished goods           $ 500,000    
  Cost of purchases     460,000            
  Cost of goods manufactured             886,000    
  Ending inventory                  
     Merchandise     150,000            
     Finished goods             144,000    

 

Compute cost of goods sold for each of these two companies for the year ended December 31, 2011. (Omit the “$” sign in your response.)

 

  Cost of goods sold
  Century Merchandising  
  New Homes Manufacturing  

 

 

Exercise 14-9 Cost of goods manufactured and cost of goods sold computation L.O. P1, P2

[The following information applies to the questions displayed below.]

Using the following data,

 

  Canyon
Company
  Rossings
Company
 
  Beginning finished goods inventory   $ 14,000     $ 18,450    
  Beginning goods in process inventory     16,500       21,950    
  Beginning raw materials inventory     9,250       11,000    
  Rental cost on factory equipment     29,000       24,750    
  Direct labor     21,000       37,000    
  Ending finished goods inventory     19,650       15,300    
  Ending goods in process inventory     24,000       18,000    
  Ending raw materials inventory     7,300       9,200    
  Factory utilities     11,000       14,000    
  Factory supplies used     10,200       5,200    
  General and administrative expenses     23,000       45,000    
  Indirect labor     3,250       9,660    
  Repairs—Factory equipment     6,780       3,500    
  Raw materials purchases     35,000       54,000    
  Sales salaries     52,000       48,000    

 

Section Break Difficulty: Hard  
Exercise 14-9 Cost of goods manufactured and cost of goods sold computation L.O. P1, P2 Learning Objective: 14-P2 Prepare a manufacturing statement and explain its purpose and links to financial statements.  

 

2.

 

Exercise 14-9 Part 1

1. Compute the cost of goods manufactured for both Canyon Company and Rossings Company. (Omit the “$” sign in your response.)

 

  Canyon Company Rossings Company
 Cost of goods manufactured    

rev: 03-04-11

3.

 

Exercise 14-9 Part 2

2. Compute cost of goods sold for both Canyon Company and Rossings Company. (Omit the “$” sign in your response.)

 

  Canyon Company Rossings Company
 Cost of goods sold    

 

4.

 

 

Exercise 14-11 Manufacturing statement preparation L.O. P2

Given the following selected account balances of Randa Company.

 

     
  Sales $ 1,252,000
  Raw materials inventory, Dec. 31, 2010   39,000
  Goods in process inventory, Dec. 31, 2010   55,900
  Finished goods inventory, Dec. 31, 2010   64,750
  Raw materials purchases   177,600
  Direct labor   227,000
  Factory computer supplies used   19,840
  Indirect labor   49,000
  Repairs—Factory equipment   7,250
  Rent cost of factory building   59,000
  Advertising expense   96,000
  General and administrative expenses   131,300
  Raw materials inventory, Dec. 31, 2011   44,700
  Goods in process inventory, Dec. 31, 2011   43,500
  Finished goods inventory, Dec. 31, 2011   69,300

 

Prepare its manufacturing statement for the year ended on December 31, 2011. (Input all amounts as positive values. Omit the “$” sign in your response.)

 

 

 

5.

 

Exercise 14-12 Income statement preparation L.O. P2

Following are the selected account balances of Randa Company:

 

     
  Sales $ 1,252,000
  Raw materials inventory, Dec. 31, 2010   39,000
  Goods in process inventory, Dec. 31, 2010   55,900
  Finished goods inventory, Dec. 31, 2010   64,750
  Raw materials purchases   177,600
  Direct labor   227,000
  Factory computer supplies used   19,840
  Indirect labor   49,000
  Repairs—Factory equipment   7,250
  Rent cost of factory building   59,000
  Advertising expense   96,000
  General and administrative expenses   131,300
  Raw materials inventory, Dec. 31, 2011   44,700
  Goods in process inventory, Dec. 31, 2011   43,500
  Finished goods inventory, Dec. 31, 2011   69,300

 

Prepare an income statement for Randa Company (a manufacturer). Assume that its cost of goods manufactured is $546,390. (Input all amounts as positive values. Omit the “$” sign in your response.)

 

 

Problem 14-8A Manufacturing and income statements; inventory analysis L.O. P2

[The following information applies to the questions displayed below.]

The following calendar year-end information is taken from the December 31, 2011, adjusted trial balance and other records of Plaza Company.

 

               
  Advertising expense $ 30,750     Direct labor $ 677,480  
  Depreciation expense—Office equipment   9,250     Income taxes expense   235,725  
  Depreciation expense—Selling equipment   10,600     Indirect labor   58,875  
  Depreciation expense—Factory equipment   35,550     Miscellaneous production costs   10,425  
  Factory supervision   104,600     Office salaries expense   65,000  
  Factory supplies used   9,350     Raw materials purchases   927,000  
  Factory utilities   35,000     Rent expense—Office space   24,000  
  Inventories         Rent expense—Selling space   28,100  
     Raw materials, December 31, 2010   168,850     Rent expense—Factory building   78,800  
     Raw materials, December 31, 2011   184,000     Maintenance expense—Factory equipment   37,400  
     Goods in process, December 31, 2010   17,700     Sales   4,527,000  
     Goods in process, December 31, 2011   21,380     Sales discounts   64,500  
     Finished goods, December 31, 2010   169,350     Sales salaries expense   394,560  
     Finished goods, December 31, 2011   138,490          

 

Section Break Problem 14-8A Manufacturing and income statements; inventory analysis L.O. P2  

 

6.

Problem 14-8A Part-1

Required:

 

1. Prepare the company’s 2011 manufacturing statement. (Input all amounts as positive values. Omit the “$” sign in your response.)

 

 

7.

Problem 14-8A Part-2

2. Prepare the company’s 2011 income statement that reports separate categories for (a) selling expenses and (b) general and administrative expenses. (Input all amounts as positive values. Omit the “$” sign in your response.)

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