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Accounting

27th Edition
WARREN + 5 others
ISBN: 9781337272094

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BuyFindarrow_forward

Accounting

27th Edition
WARREN + 5 others
ISBN: 9781337272094
Textbook Problem

Cost of goods sold, cost of goods manufactured

Glenville Company has the following information for April:

Cost of direct materials used in production $280,000
Direct labor 324,000
Factory overhead 188,900
Work in process inventory, April 1 72,300
Work in process inventory, April 30 76,800
Finished goods inventory, April 1 39,600
Finished goods inventory, April 30 41,200

For April, determine (a) the cost of goods manufactured and (b) the cost of goods sold.

(a)

To determine

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.

Cost of goods manufactured:

Cost of goods manufactured refers to the cost incurred for a making a product, that are available for sales at the end of the accounting period.

To determine: The cost of goods manufactured.

Explanation

The cost of goods manufactured is determined as follows:

Particulars $ $
Work in progress inventory, April 1   72,300
Cost of direct materials used in production 280,000  
Direct labor 324,000  

(b)

To determine
The cost of goods sold.

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