Pisna, Inc., manufactures dowhats. The manufacturing costs incurred during its first year of operations are as follows:

During the year, 100 completed dowhats were manufactured, of which 90 were sold. (Assume that the amount of the ending inventory of finished goods and the cost of goods sold are determined using the average per-unit cost of manufacturing a completed dowhat.)
Instructions

a. Compute each of the following and show all computations:
1. The average per-unit cost of manufacturing a completed dowhat during the current year.
2. The year-end balances of the following inventories: materials, work in progress, and finished goods.
3. The cost of goods sold during the year.

b. For the current year, the costs of direct materials purchased, direct labor, and manufacturing overhead total \(\$ 1,175,000\). Is this the amount of manufacturing costs deducted from revenue in the current year? Explain fully.

Transcribed Image Text:

Direct materials purchased Direct materials used Direct labor Manufacturing overhead Cost of finished goods manufactured (100 dowhats). $400,000 385,000 350,000 425,000 900,000