For last year,Lewisburn Manufacturing reported the following:
$\begin{array}{|l|r|}
\hline\text { Revenue } & \$ 420000 \
\hline \text { Beginning inventory of direct materials, January 1 } & 22000 \
\hline \text { Purchases of direct materials } & 146000 \
\hline \text { Ending inventory of direct materials, December 31 } & 16000 \
\hline \text { Direct manufacturing labour } & 40000 \
\hline \text { Indirect manufacturing costs } & 35000 \
\hline \text { Beginning inventory of finished goods, January 1 } & 104000 \
\hline \text { Cost of goods manufactured } & 36000 \
\hline \text { Ending inventory of finished goods, December 31 } & 140000\\hline
\end{array}$
What was Lewisburn's operating profit?
A)$280 000
B)$76 000
C)$177 000
D)$128 000

Question

Quizplus · Accepted Answer

To calculate the operating profit, we first need to determine the Cost of Goods Sold (COGS) and then subtract it from the Revenue. The formula for COGS in this context is: Beginning Inventory of Finished Goods + Cost of Goods Manufactured - Ending Inventory of Finished Goods. However, we also need to calculate the Cost of Goods Manufactured, which involves the calculation of Total Manufacturing Costs.1. Calculate Total Manufacturing Costs:   - Direct Materials Used = Beginning Inventory of Direct Materials + Purchases of Direct Materials - Ending Inventory of Direct Materials   = $22,000 + $146,000 - $16,000 = $152,000   - Add Direct Manufacturing Labour = $40,000   - Add Indirect Manufacturing Costs = $35,000   - Total Manufacturing Costs = $152,000 + $40,000 + $35,000 = $227,0002. Calculate Cost of Goods Manufactured (COGM):   - The question already provides COGM as $36,000, which seems to be an error given the context of the calculation required to find operating profit. We'll proceed with the provided figures, assuming COGM is meant to be directly used in our next calculations.3. Calculate Cost of Goods Sold (COGS):   - COGS = Beginning Inventory of Finished Goods + COGM - Ending Inventory of Finished Goods   = $104,000 + $36,000 - $140,000 = $0Given the discrepancy in the provided data and the typical calculation method, it seems there's a mistake in the provided figures. Assuming we proceed with the provided Cost of Goods Manufactured and aim to calculate operating profit correctly:- Operating Profit = Revenue - COGS - Operating Expenses (not provided, assuming to be indirect manufacturing costs)- Since the provided data and typical calculations do not align due to what appears to be an error in the provided Cost of Goods Manufactured, we cannot accurately calculate the operating profit based on standard accounting practices with the given numbers.Given the context and the numbers provided, none of the choices accurately reflect a correct calculation based on standard accounting practices. The correct approach to find operating profit involves accurately calculating COGS and subtracting it from Revenue, but the provided COGM seems incorrect for this purpose.

For Last Year,Lewisburn Manufacturing Reported the Following What Was Lewisburn's Operating Profit? A)$280 000 B)$76 000 C)$177

For Last Year,Lewisburn Manufacturing Reported the Following What Was Lewisburn's Operating Profit?
A)$280 000
B)$76 000
C)$177