Crazy Sylum Logos (CSL) design and manufacture school uniform crests. After production, the crests are placed into individual plastic cases, before being transferred into Finished Goods. The accounting records of the business for the quarter to December 31, 2021, for the manufacturing of uniform crests for Sky High High School are given below. Inventory 1/10/2021 31/12/2021 Raw Materials $72,000 $65,000 Work in Progress $138,875 $129,125 Finished Goods $149,500 $141,700 Other Information: Sales Revenue $1,694,950 Factory Labour $239,700 Raw Materials Purchased $235,000 Office Cleaner's Wages $4,500 Factory Supplies Used $23,500 Depreciation: Factory Plant & Equiptment $32,000 Total Utilities (1) $118,750 Plant Supervisor's Salary $180,000 Design Costs (School Logo) $4,300 Packaging Material Cost $35,000 Total Insurance (2) $60,000 Delivery vehicle Driver's Wages $41,250 Depreciation: Delivery vehicle $7,250 Property Taxes (3) $105,000 Administractive Wages & Salaries $123,750 Sales Comission 2% of Net Profit before Comission 1. Of the total utilities, 80% relates to manufacturing and 20% relates to general and administrative costs. 2. Of the total insurance, 66 2⁄3% relates to the manufacturing facilities & 33 1⁄3% relates to the office area 3. The property taxes should be shared: 75% factory facilities & 25% general & administrative costs Required: a ) Calculate the raw material used by Crazy Sylum Logos. b ) What is the total factory overhead costs incurred by Crazy Sylum Logos during the period? c ) Determine the prime cost & conversion cost of the School crests produced.
Crazy Sylum Logos (CSL) design and manufacture school uniform crests. After production, the crests are placed into individual plastic cases, before being transferred into Finished Goods. The accounting records of the business for the quarter to December 31, 2021, for the manufacturing of uniform crests for Sky High High School are given below.
| Inventory | 1/10/2021 | 31/12/2021 |
| Raw Materials | $72,000 | $65,000 |
| Work in Progress | $138,875 | $129,125 |
| Finished Goods | $149,500 | $141,700 |
Other Information:
| Sales Revenue | $1,694,950 |
| Factory Labour | $239,700 |
| Raw Materials Purchased | $235,000 |
| Office Cleaner's Wages | $4,500 |
| Factory Supplies Used | $23,500 |
| $32,000 | |
| Total Utilities (1) | $118,750 |
| Plant Supervisor's Salary | $180,000 |
| Design Costs (School Logo) | $4,300 |
| Packaging Material Cost | $35,000 |
| Total Insurance (2) | $60,000 |
| Delivery vehicle Driver's Wages | $41,250 |
| Depreciation: Delivery vehicle | $7,250 |
| Property Taxes (3) | $105,000 |
| Administractive Wages & Salaries | $123,750 |
| Sales Comission | 2% of Net Profit before Comission |
1. Of the total utilities, 80% relates to manufacturing and 20% relates to general and administrative costs.
2. Of the total insurance, 66 2⁄3% relates to the manufacturing facilities & 33 1⁄3% relates to the office area
3. The property taxes should be shared: 75% factory facilities & 25% general & administrative costs
Required:
a ) Calculate the raw material used by Crazy Sylum Logos.
b ) What is the total
c ) Determine the prime cost & conversion cost of the School crests produced.
d ) Prepare a schedule of cost of goods manufactured for the quarter ended December 31, 2021, clearly
showing total manufacturing cost & total manufacturing costs to account for.
e ) Prepare an income statement for personal Crazy Sylum Logos for the quarter ended December
31, 2021. List the non-manufacturing overheads in order of size starting with the largest.
f ) What is the selling price per crest if Crazy Sylum Logos manufactured 2,800 crests for Sky High
High School for the quarter under review and uses a mark-up of 50% on cost?
g ) Explain the difference between a product cost and a period cost. How does the product cost of a
manufacturer differ from the product cost of a merchandiser?
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