Computing COGM and COGS The following cost information are gathered from Drusilla Inc. for the month ended June 30: Costs of direct materials used in production process Direct labor costs Total costs of factory overhead Work-in-process inventory, June 1 Required: Work-in-process inventory, June 30 Finished goods inventory, June 1 Finished goods inventory, June 30 Selling expenses Adminsitrative expenses Determine the following: a. Costs of goods manufactured b. COGS c. Period costs Solution a. Solution b. COGM = BWIP + Manufacturing costs incurred - EWIP Work-in-process inventory, June 1 Manufacturing costs incurred: Costs of direct materials used in production process Direct labor costs Total costs of factory overhead Total manufacturing costs in process Work-in-process inventory, June 30 COGM COGS = BFG+ COGM - EFG BFG Plus COGM Equals Costs of goods available for sale (COGAS) Less EFG equals Costs of goods sold Solution c. Period costs = Selling costs + administrative costs Acronyms: $1,250,000 BWIP EWIP 1,100,000 520,000 BFG EFG Beginning Work-in-process inventory Ending Work-in-process inventory Beginning Finished Goods inventory Ending Finished Goods inventory 418,000 375,000 148,000 137,000 150,000 80,000 Computing COGM and COGS Compute the missing items from the COGM data for January and February: January February Beginning WIP 155000? Manufacturing costs incurred in the period 1325000? Total Manufacturing costs in the process ? 1520000 Ending WIP 165000? COGM ? 1395000 Solution: Beginning WIP Manufacturing costs incurred in the period Total Manufacturing costs in the process Ending WIP COGM January February EX.15-16: Statement of Costs of Goods Manufactured (COGM) and Costs of Goods Sold (COGS) Cost data for Sanusky Manufacturing Company for the month ended January 31 are as follows: Inventories Materials (RM) Work in process (WIP) Finished Goods (FG) Direct labor Materials purchased during January Factory overhead incurred during January: Indirect labor Machinery deprecistion Heat, light and power Supplies January 1 January 31 $180,000 334,600 $145,500 290,700 675,000 715,000 $2,260,000 1,375,000 115,000 90,000 55,000 18,500 10,000 33,100 Required: Solution: 1 Property taxes Miscellaneous costs 1. Prpare a COGM Statement for Janurary, 2. Determine the COGS for January. Beginning WIP Direct materials Beginning RM RM purchased Sanusky Manufacturing Company Statement of Cost of Goods Manufactured For the Month Ended January 31 RM/FOH Costs added COGM Costs of RM available for use Solution: 2 less Ending RM Cost of RM used Direct labor Factory overhead (FOH) Indirect labor Machinery deprecistion Heat, light and power Supplies Property taxes Miscellaneous costs Total costs of FOH Total manufacturing costs incurred in period Total manufacturing costs in the process Less Ending WIP COGM Beginning FG inventory Plus COGM Equals Costs of goods available for sale Less Ending FG inventory COGS Robstown Corporation Statement of Cost of Goods Manufactured For the Year Ended December 31, 20YY RM/FOH Coss added COGM Robstown Corporation Statement of Cost of Goods Sold For the Year Ended December 31, 20YY $ PR 15-5A: Statement of Costs of Goods Manufactured (COGM) and Income Statement for a manufacturing Company The following information is available for Robstown Corporation for 20YY: Inventories Raw Materials (RM) Work in process (WIP) Finished Goods (FG) January 1 December 31 44,250 31,700 63,900 80,000 101,200 99,800 Other Expenses Advertising expense Depreciation expense-office equipment Depreciation expense-factory equipment Direct labor Heat, light and power-factory Indirect labor Material purchased Office salaries expense Property taxes-factory Property taxes-office building Rent expense-factory Sales Sales salaries expense Supplies-factory Miscellaneous costs -factory 400,000 30,000 80,000 1,100,000 53,300 115,000 556,600 318,000 40,000 25,000 27,000 3,850,000 200,000 9,500 11,400 Required: Prepare the following for Robstown for the year ended December 31, 20YY. A. COGM Statement B. COGS C. Income statement Robstown Corporation Income Statement For the Year Ended December 31, 20YY S S