Cost of Goods Manufactured, Income Statement

Vasani House Company produces numerous fabrics for use in automobile, airplane, and boat seats. For last year, Vasani House reported the following:

Work-in-process inventory, January 1		$ 13,260
Work-in-process inventory, December 31		28,120
Finished goods inventory, January 1		113,480
Finished goods inventory, December 31		84,660
Direct materials inventory, January 1		3,540
Direct materials inventory, December 31		2,600
Direct materials purchased		184,440
Direct labor		139,000
Plant depreciation		19,200
Salary, production supervisor		47,260
Indirect labor		68,200
Utilities, factory		15,710
Sales commissions		42,480
Salary, sales supervisor		75,490
Depreciation, factory equipment		32,100
Administrative expenses		168,440
Supplies (40% used in the factory, 60% used in the sales office)		17,680
Advertising expense		43,040

Last year, Vasani House produced 88,770 units and sold 90,960 units at $10.90 per unit.

Required:

1. Prepare a statement of cost of goods manufactured.

Vasani House Company Statement of Cost of Goods Manufactured For Last Year

Direct materials:
	$___
	___
	___
Direct Materials used in production		___
		____
Manufacturing Overhead
	___
	___
	___
	___
	___
	___	___
		$___
		___
		___
Cost of goods manufactured		$___

2. Prepare an absorption-costing income statement.

Vasani House Company Income Statement: Absorption Costing For Last Year

Sales		$____
Cost of goods sold:
Beginning finished goods inventory	$___
Add: Cost of goods manufactured	____
Goods available for sale	___
Less: Ending finished goods inventory	____	____
Gross margin		$___
Less operating expenses:
Selling expenses	$___
Administrative expenses	____	____
Operating income		$___