Managerial Accounting 1B Ch14

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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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