Cost of Goods Manufactured, Income Statement Norton Industries, a manufacturer of cable for the heavy construction industry, closes its books and prepares financial statements at the end of each month. The statement of cost of goods sold for April 2010 follows:

NORTON INDUSTRIES

Statement of Cost of Goods Sold

For the Month Ended April 30, 2010

($000 omitted)

Inventory of finished goods, March 31 ....... $ 50

Cost of goods manufactured ........... 790

Cost of goods available for sale ..........$840

Less inventory of finished goods, April 30 ........ 247

Cost of goods sold ...............$593

Additional Information

• Of the utilities, 80 percent relates to manufacturing the cable; the remaining 20 percent relates to the sales and administrative functions.

• All rent is for the office building.

• Property taxes are assessed on the manufacturing plant.

• Of the insurance, 60 percent is related to manufacturing the cable; the remaining 40 percent is related to the sales and administrative functions.

• Depreciation expense includes the following:

Manufacturing plant .........$20,000

Manufacturing equipment ........30,000

Office equipment ...........4,000

$54,000

• The company manufactured 7,825 tons of cable during May 2010.

• The inventory balances at May 31, 2010, follow:

• Direct materials inventory $23,000

• Work-in-process inventory $220,000

• Finished goods inventory $175,000

NORTON INDUSTRIES

Preclosing Account Balances

May 31, 2010

($000 omitted)

Cash and marketable securities............$ 54

Accounts and notes receivable ............ 210

Direct materials inventory (4/30/2010) .......... 28

Work-in-process inventory (4/30/2010) ......... 150

Finished goods inventory (4/30/2010) ......... 247

Property, plant, and equipment (net) ........... 1,140

Accounts, notes, and taxes payable .......... 70

Bonds payable ..................600

Paid-in capital ..................100

Retained earnings .................930

Sales ...................... 1,488

Sales discounts .................. 20

Other revenue ................... 2

Purchases of direct materials ..............510

Direct labor ....................260

Indirect factory labor ................ 90

Office salaries ...................122

Sales salaries .................... 42

Utilities .....................135

Rent ....................... 9

Property tax ................... 60

Insurance .................... 20

Depreciation ................... 54

Interest expense ................... 6

Freight-in for materials purchases ............ 15

Required

Based on Exhibit 3.15A, prepare the following:

1. Statement of cost of goods manufactured for Norton Industries for May 2010.

2. Income statement for Norton Industries for May 2010.

(CMA Adapted)