Darcy Hill is the controller for Spry Manufacturing Ltd. in London, Ontario.
Darcy just finished a phone call with the chief financial officer (CFO) of the company, who is attending a meeting with executive management at a Toronto convention center. He asked that Randy plan to come to Toronto that evening and attend a meeting early the following morning. The CFO also asked him to bring with him all of the financial data required to generate T-accounts (for raw materials inventory, factory overhead, work-in-process inventory, and finished goods inventory), a schedule of cost of goods manufactured, a statement of cost of goods sold, and an income statement for the just-completed month of January. This information would be needed in the meeting. Darcy quickly ran a report with all of the information he felt was necessary to create the reports his boss had requested. He put the financial information in his briefcase and left for Toronto immediately to avoid the poor weather that was on its way. Darcy was sure he would have lots of time in his hotel room in the evening to generate the required reports. However, when he arrived in his hotel room and pulled out the information, he was alarmed to find that some important pieces of information were missing. Darcy made a list of all the data he had plus what he needed. For those categories with missing data, the number field has a question mark. The following is the list that Darcy
Balances and Transactions
Direct materials used
Repairs and maintenance - production
Salary - production manager's salary
Indirect materials used
Beginning raw materials inventory
Ending raw materials inventory
Beginning work-in-process inventory
Ending work-in-process inventory
Beginning finished goods inventory
Ending finished goods inventory
Sales returns and allowances
Cost of goods manufactured
Goods available for sale
Cost of goods sold
Depreciation - production equipment
Raw materials purchased
Estimated annual overhead
Estimated annual direct labour
Predetermined overhead rate
Spry Manufacturing uses normal costing and applies overhead on the basis of direct labour dollars.
Prepare the data required by the CFO and calculate the missing data while preparing the T-accounts and the required schedule and statements.