MANAGERIAL

ACCOUNTING

PROJECT

Page

2

of

7

PART I

COST CLASSIFICATIONS &

REPORTING

(chapter

s

18

-

20

review)

You recently began an internship in the accounting department of Front Range Furniture. As

your first assignment you were asked to perform a cost analysis and reporting for the year

ended

December 31, 2019

The following calendar year

-

end information is taken from the December 31,

2019

, adjusted

trial balance and the records of Front Range Furniture.

Advertising Expense

$22,250

Direct Labor

$564,500

Depreciation expenseOffice Equip.

10,440

Income taxes expense

138,700

Depreciation expenseSelling Equip.

12,125

Indirect labor

61,000

Depreciation expenseFactory Equip.

37,400

Misc. Production costs

10,440

Factory supervision

123,400

Office salaries expense

72,875

Factory supplies used

(indirect

materials)

8,060

Raw materials purchased

896,375

Factory utilities

39,500

Rent expenseoffice space

25,625

Inventories:

Rent expenseselling space

29,000

Raw Materials, Dec 31,2018

42,375

Rent expensefactory building

95,500

Raw Materials, Dec 31,2019

72,430

Maintenance expense-factory

32,375

Goods

-

in

-

Process, Dec 31,

2018

14,500

Sales

5,002,000

Goods

-

in

-

Process, Dec 31,

2019

16,100

Sales Discounts

59,375

Finished Goods, Dec 31,

2018

179,200

Sales salaries expense

297,300

Finished Goods, Dec 31,

2019

143,750

FRONT RANGE FURNITURE

Manufacturing Statement

For the year ended December 31, 2019

Direct Materials

Raw materials inventory, December 31, 2018

Raw materials purchased

Raw materials available for use

Less raw materials inventory, December 31, 2019

Direct materials used

Direct Labor

Factory Overhead

Depreciation expense - Factory Equipment

Factory Supervision

Factory Supplies used

Factory Utilities

Indirect Labor

Miscellaneous production costs

Rent expense - Factory building

Misc. Factory maintenance

Total factory overhead costs

Total manufacturing costs

Goods-in-Process Inventory, December 31, 2018

Total cost of goods in process

Less Goods-in-Process Inventory, December 31, 2019

Cost of Goods Manufacture

FRONT RANGE FURNITURE

Income Statement

For the year ended December 31, 2019

Sales

$ -

Less: Sales Discounts

Net Sales

$ -

Cost of Goods Sold:

Finished Goods Inventory, December 31, 2018

$ -

Cost of Goods Manufactured

Goods available for sale

$ -

Less: Finished Goods Inventory, December 31, 2019

Cost of Goods Sold

$ -

Gross Profit from Sales

$ -

Operating Expenses

Selling Expenses

Advertising expense

$ -

Depreciation expense - selling equipment

Rent expense - selling space

Sales salaries expense

Total Selling Expenses

$ -

General and Administrative Expenses

Depreciation expense - office equipment

$ -

Office salaries expense

Rent expense - office space

Total General and Administrative Expenses

$ -

Total Operating Expenses

Income before state and federal taxes

$ -

Income Taxes Expense

Net Income

$ -

RAW MATERIALS

GOODS-IN-PROCESS

FINISHED GOODS

DATE

ACCOUNT NAMES

DEBIT

CREDIT

A

Raw Materials Inventory

-

DM

COGM

Accounts Payable

DL

FOH

B

Goods-in-Process Inventory

Raw Materials Inventory

C

Factory Payroll

List actual costs

FACTORY OVERHEAD

FACTORY PAYROLL

COST OF GOODS SOLD

Cash

Indirect Labor

Dep. Exp Factory

DL

D

Goods-in-Process Inventory

Factory superv.

-

FOH

IL

Factory Overhead

Factory supplies

Factory Payroll

Factory utilities

Misc. Prod. Costs

E

Factory Overhead

Factory Rent

Accum. Dep., Factory

Factory Maint.

Cash

-

F

Goods-in-Process Inventory

Factory Overhead

0

G

Finished Goods Inventory

Goods-in-Process Inventory

H

Cost of Goods Sold

Finished Goods Inventory

I

Factory Overhead

Cost of Goods Sold

INSTRUCTIONS: Complete the T-accounts with the information taken from the Dec 31, 2019, adjusted trial

balance from the accounting records of Front Range Furniture. After completing this section proceed to

the next tabs in these working papers to complete the other project requirements. HINT: Your numbers

may differ from the Manufacturing Statement created in requirement #1 as you will be using a

Predetermined Overhead Rate.

Use the general journal below to complete your journal entries of the cost flows

shown in your T-accounts.

Selected Trial Balance accounts

PRODUCT COSTS

PERIOD COSTS

COST BEHAVIOR

PRIME

CONVERSION

Variable

Fixed

Direct Materials

Direct Labor

Direct Labor

Overhead

Advertising Expense

Depreciation expense - Office Equipment

Depreciation expense - Selling Equipment

Depreciation expense - Factory Equipment

Factory Supervision

Factory Supplies used

Factory Utilities

Direct Materials

Indirect Materials

Direct Labor

Indirect Labor

Income Taxes Expense

Miscellaneous production costs

Office Salaries Expense

Rent Expense - Office Space

Rent Expense - Selling Space

Rent Expense - Factory Building

Maintence Expense - Factory

Sales Salaries Expense

* In theory, sales salaries can be a mixed cost if there is a