Cost of Goods Manufactured

Bobs Bistro produces party-sized hoagie sandwiches. For next year, Bobs Bistro predicts that 50,000 units will be produced with the following total costs:

Direct materials	?
Direct labor	$72,000
Variable overhead	20,000
Fixed overhead	195,000

Next year, Bobs Bistro expects to purchase $116,000 of direct materials. Projected beginning and ending inventories for direct materials and work in process are as follows:

	Direct materials Inventory	Work-in-Process Inventory
Beginning	$7,000	$11,500
Ending	$6,900	$13,500

Required:

Question Content Area

1. Prepare a statement of cost of goods manufactured.

Direct materials
Beginning inventoryBeginning work in processDirect laborEnding inventoryEnding work in processBeginning inventory	$Beginning inventory
Add: Beginning work in processAdd: Direct laborAdd: Ending inventoryAdd: Ending work in processAdd: PurchasesAdd: Purchases	Add: Purchases
Materials available	$fill in the blank 0c4032082034046_5
Less: Beginning inventoryLess: Direct laborLess: Direct materialsLess: Ending inventoryLess: PurchasesLess: Ending inventory	Less: Ending inventory
Direct materials used in production		$fill in the blank 0c4032082034046_8
Beginning inventoryDirect laborEnding inventoryEnding work in processPurchasesDirect labor		Direct labor
Beginning inventoryBeginning work in processEnding inventoryEnding work in processManufacturing (Factory) overheadManufacturing (Factory) overhead		Manufacturing (Factory) overhead
Total manufacturing costs added		$fill in the blank 0c4032082034046_13
Add: Beginning work in processAdd: Direct laborAdd: Ending inventoryAdd: Ending work in processAdd: PurchasesAdd: Beginning work in process		Add: Beginning work in process
Less: Beginning work in processLess: Direct laborLess: Ending inventoryLess: Ending work in processLess: PurchasesLess: Ending work in process		Less: Ending work in process
Cost of goods manufactured		$fill in the blank 0c4032082034046_18

1. See Example 2.2

Question Content Area

2. What if the ending inventory of direct materials decreased by $1,200? Indicate the affect that this would have on the items listed below:

	Direction of change			Amount
Direct materials used	decreaseincreaseno changeincrease	by		$fill in the blank 899527057fd0f9e_2
Total manufacturing costs	decreaseincreaseno changeincrease	by		$fill in the blank 899527057fd0f9e_4
Cost of goods manufactured	decreaseincreaseno changeincrease	by		$fill in the blank 899527057fd0f9e_6