1. Cost Assignment Methods

   Brody Company makes industrial cleaning solvents. Various chemicals, detergent, and water are mixed together and then bottled in 10-gallon drums. Brody provided the following information for last year:

   Raw materials purchases	$250,000
   Direct labor	140,000
   Depreciation on factory equipment	45,000
   Depreciation on factory building	30,000
   Depreciation on headquarters building	50,000
   Factory insurance	15,000
   Property taxes:
   Factory	20,000
   Headquarters	18,000
   Utilities for factory	34,000
   Utilities for sales office	1,800
   Administrative salaries	150,000
   Indirect labor salaries	156,000
   Sales office salaries	90,000
   Beginning balance, raw materials	124,000
   Beginning balance, work in process	124,000
   Beginning balance, finished goods	84,000
   Ending balance, raw materials	102,000
   Ending balance, work in process	130,000
   Ending balance, finished goods	82,000

   Last year, Brody completed 100,000 units. Sales revenue equaled $1,200,000, and Brody paid a sales commission of 5 percent of sales.

   Required:

   1. Calculate the direct materials used in production for last year.

   $

   2. Calculate total prime cost.

   $

   3. Calculate total conversion cost.

   $

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   4. Prepare a cost of goods manufactured statement for last year.

   Brody Company
   Statement of Cost of Goods Manufactured
   For Last Year
   Beginning work in process Cost of goods manufactured Direct materials Direct wages Ending work in process	$
   Beginning work in process Cost of goods manufactured Direct labor Direct wages Ending work in process
   Beginning work in process Cost of goods manufactured Direct wages Ending work in process Overhead
   Total manufacturing cost	$
   Add: Beginning work in process Add: Cost of goods manufactured Add: Direct labor Add: Direct materials Add: Ending work in process Add: Overhead
   Less: Beginning work in process Less: Cost of goods manufactured Less: Direct labor Less: Direct materials Less: Ending work in process Less: Overhead
   Beginning work in process Cost of goods manufactured Direct labor Direct materials Ending work in process Overhead	$

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   Calculate the unit product cost. If required, round your answer to the nearest cent.

   $

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   5. Prepare a cost of goods sold statement for last year.

   Brody Company
   Statement of Cost of Goods Sold
   For Last Year
   Beginning finished goods inventory Cost of goods available for sale Cost of goods manufactured Cost of goods sold Ending finished goods inventory	$
   Add: Beginning inventory, Finished goods Add: Cost of goods available for sale Add: Cost of goods manufactured Add: Cost of goods sold Add: Ending finished goods inventory
   Less: Beginning finished goods inventory Less: Cost of goods available for sale Less: Cost of goods manufactured Less: Cost of goods sold Less: Ending inventory, Finished goods
   Beginning finished goods inventory Cost of goods available for sale Cost of goods manufactured Cost of goods sold Ending inventory, Finished goods	$

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   6. Prepare an income statement for last year. Show the percentage of sales that each line item represents. When required, round the percent to four decimal places before converting to a percentage. For example, .88349 would be rounded to .8835 and entered as 88.35.

   Brody Company
   Income Statement
   For Last Year
   		Percent
   Administrative expenses Cost of goods sold Gross margin Operating income Sales Selling expenses	$	%
   Administrative expenses Cost of goods sold Gross margin Operating income Sales Selling expenses		%
   Administrative expenses Cost of goods sold Gross margin Operating income Sales Selling expenses	$	%
   Less: Operating expenses
   Cost of goods sold Gross margin Operating income Sales Selling expenses		%
   Administrative expenses Cost of goods sold Gross margin Operating income Sales		%
   Operating income Operating loss	$	%