BuyFind

Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094
BuyFind

Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094

Solutions

Chapter
Section
Chapter 18, Problem 18.15EX
Textbook Problem

Income statement for a manufacturing company

Two items are omitted from each of the following three lists of cost of goods sold data from a manufacturing company income statement. Determine the amounts of the missing items, identifying them by letter.

Chapter 18, Problem 18.15EX, Income statement for a manufacturing company Two items are omitted from each of the following three

Expert Solution
To determine

Income statement for a manufacturing company:

The income statement of merchandising business and manufacturing business differs mostly due to the reporting of the cost of merchandise available for sale and sold during the period.

Cost of goods sold:

Cost of goods sold is the accumulate total of all direct cost incurred in manufacturing the goods or the products which has been sold during a period. Cost of goods sold involves direct material, direct labor, and manufacturing overheads.

To determine: The amount of missing items in the income statement for a manufacturing company.

Explanation of Solution

The missing items in the income statement for a manufacturing company are determined as follows:

Particulars $ $ $
Finished goods inventory, June 1 116,600 38,880 (e) 920,000
Cost of goods manufactured 825,900 (c)                   501,120 180,000
Cost of finished goods available for sale (a) 942,500 540,000 1,100,000
Less: Finished goods inventory, June  30 130,000 70,000 (f) 155,000
Cost of goods sold (b) 812,500 (d) 470,000 945,000

Table (1)

Working notes:

  1. 1. For (a), the amount is determined as follows:

Cost of finished goods available for sale}[Finished goods inventory,June1+Cost ofgoods manufactured]=$116,600+$825,900=$924,500

(a)

  1. 2. For (b), the amount is determined as follows:

Cost of goods sold[Cost of finished goods available for saleFinished goods inventory, June 30]=$942,500$130,000=$812,500

(b)

  1. 3. For (c), the amount is determined as follows:

Cost ofgoods manufactured[Cost of finished goods available for saleFinished goods inventory,June1]=$501,120$38,880=$474,120

(c)

  1. 4

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Chapter 18 Solutions

Accounting
Show all chapter solutions
Ch. 18 - Management process Three phases of the management...Ch. 18 - Management process Three phases of the management...Ch. 18 - Direct materials, direct labor, and factory...Ch. 18 - Direct materials, direct labor, and factory...Ch. 18 - Prime and conversion costs Identify the following...Ch. 18 - Prime and conversion costs Identify the following...Ch. 18 - Product and period costs Identify the following...Ch. 18 - Product and period costs Identify the following...Ch. 18 - Cost of goods sold, cost of goods manufactured...Ch. 18 - Cost of goods sold, cost of goods manufactured...Ch. 18 - Classifying costs as materials, labor, or factory...Ch. 18 - Classifying costs as materials, labor, or factory...Ch. 18 - Classifying costs as factory overhead Which of the...Ch. 18 - Classifying costs as product or period costs For...Ch. 18 - Concepts and terminology From the choices...Ch. 18 - Concepts and terminology From the choices...Ch. 18 - Classifying costs in a service company A partial...Ch. 18 - Sustainability and eco-efficiency measures Four...Ch. 18 - Classifying costs The following report was...Ch. 18 - Financial statements of a manufacturing firm The...Ch. 18 - Manufacturing company balance sheet Partial...Ch. 18 - Cost of direct materials used in production for a...Ch. 18 - Cost of goods manufactured for a manufacturing...Ch. 18 - Cost of goods manufactured for a manufacturing...Ch. 18 - Income statement for a manufacturing company Two...Ch. 18 - Statement of cost of goods manufactured for a...Ch. 18 - Cost of goods sold, profit margin, and net income...Ch. 18 - Cost flow relationships The following information...Ch. 18 - Uses of managerial accounting in a service company...Ch. 18 - Classifying costs The following is a list of costs...Ch. 18 - Classifying costs The following is a list of costs...Ch. 18 - Cost classifications for a service company A...Ch. 18 - Manufacturing income statement, statement of cost...Ch. 18 - Statement of cost of goods manufactured and income...Ch. 18 - Classifying costs The following is a list of costs...Ch. 18 - Classifying costs The following is a list of costs...Ch. 18 - Cost classifications for a service company A...Ch. 18 - Manufacturing income statement, statement of cost...Ch. 18 - Statement of cost of goods manufactured and income...Ch. 18 - Ethics in Action Avett Manufacturing Company...Ch. 18 - Communication Todd Johnson is the vice president...Ch. 18 - Managerial accounting in the management process...Ch. 18 - Classifying costs Geek Gut Company provides...Ch. 18 - Using managerial accounting Information The...

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