Cost of Goods Sold

Pietro Frozen Foods, Inc., produces frozen pizzas. For next year, Pietro predicts that 49,100 units will be produced, with the following total costs:

Direct materials ? Direct labor 53,000 Variable overhead 25,000 Fixed overhead 185,000

Next year, Pietro expects to purchase $128,000 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 $6,000 $14,000 Ending $5,900 $16,000

Pietro expects to produce 49,100 units and sell 48,400 units. Beginning inventory of finished goods is $47,500, and ending inventory of finished goods is expected to be $39,000.

Required:

1. Prepare a statement of cost of goods sold in good form.

Pietro Frozen Foods, Inc. Statement of Cost of Goods Sold For the Coming Year $ $ $

2. What if the beginning inventory of finished goods decreased by $3,750? What would be the effect on the cost of goods sold? by $