1. Thornton Foods bakes and sells 2,000 dozen muffins each week to food service operations. Among the costs are bakers' salaries, $24,000; production management salaries, $16,000; production equipment operating costs, $32,000; and flour and ingredient costs, $15,000. Using this information, compute: (a) prime costs and (b) conversion costs.

2. Calculate Cost of Goods Sold for the following two companies:

	LEWIS, INC.	MERCER CO.
Beginning Inventory:
Merchandise	$250,000
Finished Goods		$550,000
Cost of Goods Purchased	460,000
Cost of Goods Manufactured		688,000
Ending Inventory:
Merchandise	128,000
Finished Goods		350,000

3. Information for Maxim Manufacturing is presented below. Compute both the cost of goods manufactured and the cost of goods sold for Maxim Manufacturing.

Beginning raw materials inventory	$36,800
Beginning work in process inventory	21,200
Direct labor	81,000
Beginning finished goods inventory	64,000
Total factory overhead	126,000
Raw materials purchased	21,500
Ending raw materials inventory	40,000
Ending work in process inventory	20,000
Ending finished goods inventory	46,000

4. Information for Underwood Industries is presented below. Compute the cost of goods manufactured.

	Beginning	Ending
Raw materials inventory	$26,800	30,100
Work in process inventory	41,200	39,000
Finished goods inventory	54,000	53,500
Raw materials purchased	93,500
Direct labor	61,000
Total factory overhead	117,300

5. Use the following information to prepare the schedule of cost of goods manufactured for Graffstone Company for the month ended June 30.

Work in Process inventory, May 31	$12,600
Work in Process inventory, June 30	16,500
Direct materials used during June	21,000
Direct labor used during June	31,000
Factory overhead:
Indirect material	6,400
Indirect labor	9,200
Factory rent	12,000
Factory depreciation	15,000
Factory utilities	18,400