Farmers Corporation purchased $170,000 of direct materials and incurred $48,000 of direct labour costs during the year. Indirect labour amounted to $5,000, while indirect materials totalled $6,000. Other operating expenses pertaining to the factory included utilities of $6,400, maintenance of $9,200, supplies of $3,600, amortization of $30,200, and property taxes of $5,800. The only inventory was $13,600 of finished goods at year-end.
Required:
a. Compute the cost of goods manufactured.
b. Compute the cost of goods sold.

Question

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The Answer of Farmers Corporation purchased $170,000 of direct materials and incurred $48,000 of direct labour costs during the year. Indirect labour amounted to $5,000, while indirect materials totalled $6,000. Other operating expenses pertaining to the factory included utilities of $6,400, maintenance of $9,200, supplies of $3,600, amortization of $30,200, and property taxes of $5,800. The only inventory was $13,600 of finished goods at year-end.
Required:
a. Compute the cost of goods manufactured.
b. Compute the cost of goods sold.

Farmers Corporation Purchased $170,000 of Direct Materials and Incurred $48,000