Please see attachment and complete bold items
Hayward Company, a manufacturing firm, has supplied the following information from its accounting records for the month of May: Direct labor cost ..............................................$10,500 Purchases of raw materials .................................. .15,000 Supplies used ......................................................675 Factory insurance .................................................350 Commissions paid .............................................. 2,500 Factory supervision .............................................2,225 Advertising .........................................................800 Material handling ................................................3,750 Materials inventory, May 1 ....................................3,475 Work-in-process inventory, May 1 ..........................12,500 Finished goods inventory, May 1 .............................6,685 Materials inventory, May 31 ...................................9,500 Work-in-process inventory, May 31 ........................14,250 Finished goods inventory, May 31 ...........................4,250 Required: 1. Prepare a statement of cost of goods manufactured. 2. Prepare a statement of cost of goods sold. Berry Company is an architectural firm located in Detroit, Michigan. The company works with small and medium-size construction businesses to prepare building plans according to client contract. Berry employs 10 professionals and 5 staff. The following data are provided for last year: Number of designs completed and sold ..............................700 Beginning inventory of direct materials .........................$20,000 Beginning inventory of designs in process ..................... $60,000 Ending inventory of direct materials ....................................$0 Ending inventory of designs in process ........................$100,000 Purchases, direct materials .........................................$40,000 Direct labor ..........................................................$800,000 Manufacturing overhead ..........................................$100,000 Administrative expense ...........................................$150,000 Selling expense ......................................................$60,000 Required: 1. Calculate the cost of services sold. 2. Assume that the average fee for a design is $2,100. Prepare an income statement for Berry Company. 3. Refer to the cost of services sold (calculated in Requirement 1). What is the dominant cost? Will this always be true of service organizations? If not, provide an example of an exception
