Refer to Cornerstone Exercise 2-1. For next year, Sodowsky predicts that 150,000 units will be produced, with the following total costs:

Required:
1. Prepare a statement of cost of goods manufactured in good form.
2. What if the ending inventory of direct materials increased by $2,000? Which line items on the statement of cost of goods manufactured would be affected and in what direction (increase or decrease)?LO1

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Direct materials Direct labor Variable overhead Fixed overhead $300,000 90,000 45,000 420,000 Next year, Sodowsky expects to purchase $292,400 of direct materials. Projected begin- ning and ending inventories for direct materials and work in process are as follows: Beginning Ending Direct Materials Work-in-Process Inventory $22,400 Inventory $45,000 14,800 40,000