Please help me understand where the 23,000 comes from in A. Also can you please help me understand more about the calculations for the COGM schedule in part C as well as the income statement in part D especially the adjusted COGS. I would appreciate as much work be shown as possible for me to best understand the concepts.

JOB-ORDER COSTING The Stray Cats Company uses a job-order cost system D using machine hours. The company was star 111 and Job 222). Job 111 incurred product materials, $5,000 of direct labor, and $3,000 Job 222 incurred production cost of $10,000 direct labor, and $1,000 of applied overhead None of these units were sold during 2016. There was no una 2016. The accountant for the company estir accountant also estimates that there will be sou balance in Materials Inventory for 2017 is $15,000. Actual follows: der cost system based on normal costing. Overhead is charged to jobs "pany was started during 2016. In 2016, the company worked on two jobs (Job curred production cost of $13,000 during 2016 (which includes $5,000 of direct labor, and $3,000 of applied overhead). Job 111 was NOT completed during 2016, on cost of $10,000 during 2016 (which includes $3,000 of direct materials, $6,900 OT Tapplied overhead). Job 222 was completed during 2016 and consisted of 5 units. we Units were sold during 2016. There was no underapplied or overapplied overhead at the en Sobil DM $5000 3222 DM 3000 LOU $13.000 $200 DL=Souo & 10000 OM 98000 1000 a FG=Sunits ntant for the company estimates that there will be 10,000 machine hours for the year 2017. The su estimates that there will be $80.000 of estimated overhead for 2017. The actual beginning inventory for 2017 is $15,000. Actual data for the jobs worked on during 2017 are as Sold F. G=5 FG=0 15 31 Job 111 Job 333 Job 444 55 222 Direct materials cost $14,000 $18,000 $11,000 105333 Direct labor cost $30,000 $25,000 $15,000 Machine hours 4,000 hours 5,000 hours 3,500 hours Units on the job 20 units 10 units Unfinished job Applicno 32,000 40,000 28.000 $3.8 lunit The total actual overhead cost for 2017 is $95,000. During 2017, direct materials costing $37,000 were purchased. During 2017, Job 111 and Job 333 were finished, Sales for 2017 included 15 units from Job 111,5 units from Job 222, and 10 units from Job 333. The total sales for 2017 amounted to $250,000. Selling expenses for 2017 total $40,000. Administrative expenses for 2017 total $30,000 At the end of 2017, all underapplied or overapplied overhead was charged totally to Cost of Goods Sold. A. Compute the amount of direct materials that were purchased during 2016. 5. Coo Note that this question is for 2016 not 2017. Beg Indo DMSALAM SALZ Purchases 423.0007 23,000 Available 8000 8000 15000 230/4+ soon O M ukenal B. Compute the amount of underapplied or overapplied overhead for 2017, and tell whether the amount is underapplied or overapplied. overapered by Voou POHR - 880,000 10,000MH Actual $95.000 Jobill OH 32.000 Job 333 04 40,000 Joco 444 oH 28.000 le $95.000 - 100.000 overapplied by 95000 C. Prepare, in good form, a Schedule of costo proper heading. Inv $213.000 form, a Schedule of Cost of Goods Manufactured for 2017. Remember this include Stray Cats Company ceGm for Bea year end 12/31/17 815,000 - Purchases 37,000 Materials Available 52.000 o materials left 09,000 DM *43.000- DL 70,000 OH (Applied) 100.000, Total Manu Costs Beq WIP 13:09 $22.000 Endring WIP 7172,000 D. Prepare, in good form, an income statement for 2017. please include a full cost of Goods Sold section on your statement. Again include a proper heading on your statement. Stray Cats Company Income Stachment for year end 12/31/17 sales Bea F. G 0 10,oo e coom 172,000 GATSI 82,000 4.000 8250,000 X01*21250) & 158.000 Ending F. G Inu o 19.000XF (22 unadjusted coos 163.000 overapplied OH O 5.000. o adjusted COGS - Gross Profit operating Exp. Net Income $ 92,000 70,000 $22.000 (25,250) E. Now assume that we want to prorate the underapplied or overapplied accounts rather than charging it totally to Cost of Goods Sold. Cost of Goods Sold amount has $64,000 of applied overhead from 2017 in your percentages to the nearest percent, if needed. This sho class example. date the underapplied or overapplied overhead to the appropriate Bit totally to Cost of Goods Sold. You may assume that the Unadjusted WIP F.G COGS Pried overhead from 2017 included in the total. Round carest percent, if needed. This should be in table form as we compiled in our 'Applied OH % x difference I OH 28.000 28 X 3000 1400 8,000, .08 x 5000 400 3200 64,000 5000 100,000 .64 x 5000 F. If we If we prepared another income statement after doing part E above, would the net operating income amount on this new income statement be HIGHER Or would it be LOWER than your net operating income in part of this problem? hawer G. Refer to part F. By how much would your income be higher or lower? WIP+fG