Mid term week 4 - Week 4 Midterm Midterm Week 4 : ABC and...

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Week 4 Midterm Midterm Week 4 : ABC and Budgeting - Midterm ------------------------------------------------- Page 2 The following data (in thousands of dollars) have been taken from the accounting records of Larklin Corporation for the just completed year. 1. (TCO A). | Sales | $820 | | Purchases of raw materials | $195 | | Direct labor | $170 | | Manufacturing overhead | $250 | | Administrative expenses | $180 | | Selling expenses | $140 | | Raw materials inventory, beginning | $80 | | Raw materials inventory, ending | $35 | | Work in process inventory, beginning | $65 | | Work in process inventory, ending | $30 | | Finished goods inventory, beginning | $130 | | Finished goods inventory, ending | $165 | Required: Prepare a Schedule of Cost of Goods Manufactured statement in the text box below.(Points : 15) Answer: Schedu le of cost Manuf actures Raw materia ls invento ry, beg $80.00 Add: Purcha ses of raw materia ls $195.0 0 Raw materia ls $275.0 0
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availab le for use Deduct : Raw materia ls invento ry, ending $35.00 Raw materia ls used in product ion $240.0 0 Direct labor $170.0 0 Manuf acturin g overhe ad $250.0 0 Total manufa cturing cost $660.0 0 Add: Work in process invento ry, beginni ng $65.00 $725.0 0 Deduct : Work in process invento ry, ending $30.00 Cost of goods manufa ctured $695.0 0 Compu
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tation of cost of goods sold Finishe d goods invento ry, beginni ng $130.0 0 Add: Cost of goods manufa ctured $580.0 0 Goods availab le for sale $710.0 0 Deduct : Finishe d goods invento ry, ending $165.0 0 Cost of goods sold $545.0 0 Income Statem ent Sales $820.0 0 Less: Cost of goods sold $710.0 0 Gross margin $110.0 0 Less: Admini strative expens $180.0 0
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es Less: Selling expens es $140.0 0 Net operati ng income - $210.0 0 2. (TCO F) The Indiana Company manufactures a product that goes through three processing departments. Information relating to activity in the first department during June is given below: Percent completed Units Materials Conversion Work in process, June 1 70,000 65% 45% Work in process, Jun 30 60,000 75% 65%The department started 290,000 units into production during the month and transferred 300,000 completed units to the next department.REQUIRED: Compute the equivalent units of production for the first department for June, assuming that the company uses the weighted-average method of accounting for units and costs.(Points : 20) Answer: Units in ending work X % completed Material Conversion Units transferred to the next department 300,000 300,000 Ending work in process: Materials: 60,000 x 75 % 45,000 Conversion: 60,000 x 65% 39,000 _____________________________________________________________________ Equivalent unit of production 345,000 339,000 3. (TCO B) A tile manufacturer has supplied the following data:
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This note was uploaded on 10/08/2011 for the course ACCOUNTING AC 505 taught by Professor Russ during the Spring '11 term at Keller Graduate School of Management.

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Mid term week 4 - Week 4 Midterm Midterm Week 4 : ABC and...

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