Question
Andersen Manufacturing Company produces a single product. The controller has asked for your help in preparing a schedule of cost of goods manufactured for the
Andersen Manufacturing Company produces a single product. The controller has asked for your help in preparing a schedule of cost of goods manufactured for the year just ended. The following information is available:
1.) Eleven thousand units were sold at $22 per unit. = 242,000
2.) Thirteen thousand units requiring one unit each of raw materials were produced.= 13,000
3.) Raw materials inventory at the beginning of the month was 1,100 units at $4 each.
4.) During the month, two purchases of raw materials were made:
Purchase #1: 7,000 units at $5.00 each = 35,000
Purchase #2: 6,000 units at $5.50 each = 33,000
5.) The company uses the first-in, first-out method of determining raw materials inventories.
6.) The work-in-process inventories were:
Beginning of the month: 1,500 units valued at $170,000
End of the month: 1,500 units valued at $190,000
7.) Direct labour cost was $1,010,000.
8.) Overhead is applied to production on the basis of 65% of direct labour cost.
Required:
How much is the cost of goods manufactured for the month?
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