Question 1

Information for Maxim Manufacturing is presented below. Compute both the cost of goods manufactured and the cost of goods sold for Maxim Manufacturing.
 $$\begin{array} { | l | r | } 
\hline \text { Beginning raw materials inventory } & \$ 36,800 \
\hline \text { Beginning work in process inventory } & 21,200 \
\hline \text { Direct labor } & 81,00 \
\hline \text { Beginning finished goods inventory } & 64,000 \
\hline \text { Total factory overhead } & 126,000 \
\hline \text { Raw materials purchased } & 21,500 \
\hline \text { Ending raw materials inventory } & 40,000 \
\hline \text { Ending work in process inventory } & 20,000 \
\hline\text { Ending finished goods inventory } & 46,000\
\hline
\end{array}$$

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Question 2

Use the following information to prepare the schedule of cost of goods manufactured for Graffstone Company for the month ended June 30.
 $$\begin{array} { | l | r | } 
\hline \text { Work in Process inventory, May 31 } & \$ 12,600 \
\hline \text { Work in Process inventory, June 30 } & 16,500 \
\hline \text { Direct materials used during June } & 21,000 \
\hline \text { Direct labor used during June } & 31,000 \
\hline \text { Factory overhead: } &  \
\hline \text { Indirect material } &6,400 \
\hline \text { Indirect labor } &  9,200 \
\hline \text { Factory rent } & 12,000 \
\hline \text { Factory depreciation } &15,000  \
\hline \text { Factory utilities } & 18,400 \
\hline 
\end{array}$$

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Question 3

The Tacky Company manufactures staples. Costs for October were direct labor, $84,000; indirect labor, $36,700; direct materials, $55,900; factory maintenance, $4,800; factory utilities, $3,200; and insurance on plant and equipment, $700. What is Tacky Company's factory overhead for October?

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Question 4

The following costs are incurred by Gonzalez Manufacturing Co. Classify each cost item as either a period cost or a product cost. If the cost is a product cost, identify it as a prime and/or conversion cost.

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Question 5

Information for Eastman Industries is presented below. Compute the cost of goods manufactured.
 $$\begin{array} { | l | r | } 
\hline \text { Beginning work in process inventory } & 21,200 \
\hline \text { Ending work in process inventory } & 20,000 \
\hline \text { Raw materials used in production } & \$ 46,800 \
\hline \text { Direct labor } & 81,000 \
\hline \text { Total factory overhead } & 106,000 \
\hline
\end{array}$$

Accepted Answer

The answer of Information for Eastman Industries is presented below....

Question 6

A manufacturing company's finished goods inventory on January 1 was $68,000; cost of goods manufactured was $147,000; and the December 31 finished goods inventory was $77,000. What is the cost of goods sold for that year?

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Question 7

Information for Stanton, Inc., as of December 31 follows. Prepare a schedule of cost of goods manufactured for the year ended December 31.

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Question 8

The following items for Neptune Company are used to compute the cost of goods manufactured and the cost of goods sold. Indicate how each item should be used in the calculations by filling in the blanks with "+" if the item is to be added, "-" if the item is to be subtracted, or "0" if the item is not used in the calculation. The first item is completed as an example.
 $$\begin{array} { | l | l | l | } 
\hline & \text { Cost of Goods } & \text { Cost of Goods } \
\hline \text { Beginning finished goods inventory } & \text { Manufactured } & \text { Sold } \
\hline \text { Ending finished goods inventory } & 0 & + \
\hline \text { Direct labor } & & \
\hline \text { Indirect labor } & & \
\hline \text { Beginning work in process inventory } & & \
\hline \text { Ending work in process inventory } & & \
\hline \text { General and administrative expenses } & & \
\hline \text { Indirect materials } & & \
\hline \text { Beginning raw materials inventory } & & \
\hline \text { Ending raw materials inventory } & & \
\hline \text { Raw material purchases } & & \
\hline \text { Depreciation of factory building } & & \
\hline \text { Cost of goods manufactured } & & \
\hline & & \
\hline
\end{array}$$

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Question 9

The Langston Company manufactures coats. Costs for February were as follows:
 $$\begin{array} { | l | r | } 
\hline \text { Direct materials } & \$ 19,650 \
\hline \text { Direct labor } & 15,21 \
\hline \text { Factory insurance } & 950 \
\hline \text { Sales commissions } & 4,700 \
\hline \text { Corporate executive salaries } & 5,500 \
\hline \text { Factory supervisor salary } & 3,500 \
\hline \text { Indirect materials } & 1,920\
\hline  
\end{array}$$ Required: Calculate the total manufacturing cost for February.

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Question 10

Walter Products and Sandburg Industries report the following information at December 31:
  Required:
(a) Which company is a manufacturer? Explain.
(b) Prepare the Current Asset Section of the Balance Sheet for the manufacturer.

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Question 11

Brotherton Company is a manufacturer of Blu-ray discs. Place each of the following costs in the appropriate column.

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Question 12

Information for Underwood Industries is presented below. Compute the cost of goods manufactured.
 $$\begin{array} { | l | l | l | } 
\hline & \text { Beginning } & \text { Ending } \
\hline \text { Raw materials inventory } & \$ 26,800 & 30,100 \
\hline \text { Work in process inventory } & 41,200 & 39,000 \
\hline \text { Finished goods inventory } & 54,000 & 53,500 \
\hline & & \
\hline \text { Raw materials purchased } & 93,500 & \
\hline \text { Direct labor } & 61,000 & \
\hline \text { Total factory overhead } & 117,300 & \
\hline
\end{array}$$

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Question 13

Thornton Foods bakes and sells 2,000 dozen muffins each week to food service operations. Among the costs are bakers' salaries, $24,000; production management salaries, $16,000; production equipment operating costs, $32,000; and flour and ingredient costs, $15,000. Using this information, compute: (a) prime costs and (b) conversion costs.

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Question 14

Marv's Furniture and Fixtures produces seats for movie theaters. Listed below are selected cost items for the seat production. Classify each cost as either fixed or variable, and either a product or a period cost by placing an x in the appropriate boxes.

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Question 15

A manufacturing company's beginning finished goods inventory was $29,000; cost of goods manufactured was $316,000; and the ending finished goods inventory was $31,000. What is the cost of goods sold for that year?

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Question 16

For each item shown below, classify it as a product cost or a period cost, by placing an X in the appropriate column. For each item that is a product cost, also indicate whether it is a direct cost or an indirect cost with respect to a unit of finished product.

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Question 17

Information for the Deuce Manufacturing Company follows. Compute the cost of goods manufactured for this company.
 $$\begin{array} { | l | r | } 
\hline \text { Beginning raw materials inventory } & \$ 53,200 \
\hline \text { Beginning work in process, inventory } & 78,400 \
\hline \text { Ending raw materials inventory } & 58,100 \
\hline \text { Ending work in process, inventory } & 98,000 \
\hline \text { Direct labor } & 149,800 \
\hline \text { Total factory overhead } & 105,000 \
\hline \text { Raw material purchases } & 210,000 \
\hline
\end{array}$$

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Question 18

Compute the ending work in process inventory for a manufacturer with the following information.
 $$\begin{array} { | l | r | } 
\hline \text { Raw materials purchased } & 131,700 \
\hline \text { Raw materials used in production } & 65,400 \
\hline \text { Direct labor used } & 44,000 \
\hline \text { Total factory overhead used } & 101,600 \
\hline \text { Work in process inventory, beginning of year } & 32,500 \
\hline \text { Cost of goods manufactured } & 212,900 \
\hline
\end{array}$$

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Question 19

Calculate Cost of Goods Sold for the following two companies:

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Question 20

Duncan Crafts manufactures specialty key chains for tourist attractions. On January 1, the firm had 300 souvenir attraction disks used in the production of the chains that cost $3 each; and 600 completed key chains that cost $6 each. During the year Duncan Crafts purchased 1,500 souvenir disks costing $3 each and produced 1,100 key chains. Compute the total cost of raw materials inventory at December 31.

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Quiz 1: Managerial Accounting Concepts and Principles