Manufacturing Income Statement, Statement of Cost of Goods Manufactured

Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies for the month of December:

	On Company		Off Company
Materials inventory, December 1	$65,800		$195,300
Materials inventory, December 31	(a)		91,140
Materials purchased	282,800		(a)
Cost of direct materials used in production	317,800		(b)
Direct labor	387,800		577,220
Factory overhead	148,400		256,060
Total manufacturing costs incurred in December	(b)		1,519,000
Total manufacturing costs	973,000		1,727,320
Work in process inventory, December 1	119,000		208,320
Work in process inventory, December 31	172,200		(c)
Cost of goods manufactured	(c)		1,532,020
Finished goods inventory, December 1	224,000		269,080
Finished goods inventory, December 31	197,400		(d)
Sales	1,127,000		1,944,320
Cost of goods sold	(d)		1,545,040
Gross profit	(e)		(e)
Operating expenses	117,600		(f)
Net income	(f)		164,920

Required:

1. Determine the amounts of the missing items, identifying them by letter. Enter all amounts as positive numbers.

Letter	On Company	Off Company
a.	$fill in the blank 4f6db8fab034fe3_1	$fill in the blank 4f6db8fab034fe3_2
b.	$fill in the blank 4f6db8fab034fe3_3	$fill in the blank 4f6db8fab034fe3_4
c.	$fill in the blank 4f6db8fab034fe3_5	$fill in the blank 4f6db8fab034fe3_6
d.	$fill in the blank 4f6db8fab034fe3_7	$fill in the blank 4f6db8fab034fe3_8
e.	$fill in the blank 4f6db8fab034fe3_9	$fill in the blank 4f6db8fab034fe3_10
f.	$fill in the blank 4f6db8fab034fe3_11	$fill in the blank 4f6db8fab034fe3_12

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1.

a. The cost of direct materials used in production includes the beginning materials inventory plus purchases, less the ending materials inventory.

b. Total manufacturing costs incurred during December include direct materials, direct labor, and factory overhead.

c. The cost of goods manufactured is beginning work in process plus total manufacturing costs less the ending work in process.

d. The cost of goods sold is the beginning finished goods plus the cost of goods manufactured, less the ending finished goods.

e. Sales minus cost of goods sold equals gross profit.

f. Gross profit minus operating expenses equals net income.

Use similar relationships from On Company to find the missing amounts for the Off Company items (a) through (f).

2. Prepare On Company's statement of cost of goods manufactured for December.

On Company
Statement of Cost of Goods Manufactured
For the Month Ended December 31
Work in process inventory, December 1			$fill in the blank 5ab7e106c064fbf_2
Direct materials:
Materials inventory, December 1	$fill in the blank 5ab7e106c064fbf_4
Purchases	fill in the blank 5ab7e106c064fbf_6
Cost of materials available for use	$fill in the blank 5ab7e106c064fbf_8
Materials inventory, December 31	fill in the blank 5ab7e106c064fbf_10
Cost of direct materials used in production		$fill in the blank 5ab7e106c064fbf_12
Direct labor		fill in the blank 5ab7e106c064fbf_14
Factory overhead		fill in the blank 5ab7e106c064fbf_16
Total manufacturing costs incurred during December			fill in the blank 5ab7e106c064fbf_17
Total manufacturing costs			$fill in the blank 5ab7e106c064fbf_18
Work in process inventory, December 31			fill in the blank 5ab7e106c064fbf_20
Cost of goods manufactured			$fill in the blank 5ab7e106c064fbf_22

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2. The cost of goods manufactured is the beginning work in process plus the cost of direct materials used in production plus direct labor and factory overhead, less the ending work in process.

3. Prepare On Company's income statement for December.

On Company
Income Statement
For the Month Ended December 31
Sales		$fill in the blank c0839dfe3004000_2
Cost of goods sold:
Finished goods inventory, December 1	$fill in the blank c0839dfe3004000_4
Cost of goods manufactured	fill in the blank c0839dfe3004000_6
Cost of finished goods available for sale	$fill in the blank c0839dfe3004000_8
Finished goods inventory, December 31	fill in the blank c0839dfe3004000_10
Cost of goods sold		fill in the blank c0839dfe3004000_12
Gross profit		$fill in the blank c0839dfe3004000_14
Operating expenses		fill in the blank c0839dfe3004000_16
Net income		$fill in the blank c0839dfe3004000_18