Question
Problem: 1 Use the following information to determine the gross margin for Pacific States Manufacturing for the year just ended (all amounts are in thousands
Problem: 1
Use the following information to determine the gross margin for Pacific States Manufacturing for the year just ended (all amounts are in thousands of dollars):
| Sales | $31,800 |
| Purchases of direct materials | $7,000 |
| Direct labour | $5,000 |
| Work in process, 1/1 | $800 |
| Work in process, 1/31 | $3,000 |
| Finished goods inventory, 1/1 | $4,000 |
| Finished goods inventory, 1/31 | $5,300 |
| Accounts payable, 1/1 | $1,700 |
| Accounts payable, 1/31 | $1,500 |
| Direct materials inventory, 1/1 | $6,000 |
| Direct materials inventory, 1/31 | $1,000 |
| Indirect labour | $600 |
| Indirect materials used | $500 |
| Utilities expense, factory | $1,900 |
| Depreciation on factory equipment | $3,500 |
Use the following for your answer
| Beginning work in process inventory | |||
| Add: Direct materials used | |||
| Beginning raw materials inventory | |||
| Purchase of direct materials | |||
| Available for use | |||
| Ending raw materials inventory |
| ||
| Direct materials used | |||
| Direct labour | |||
| Manufacturing overhead | |||
| Total manufacturing costs for the month | |||
| Total manufacturing costs to account for | |||
| Add: Opening work in process inventory | |||
| Less: ending work in process inventory | |||
| Cost of goods manufactured |
| Beginning finished goods inventory | |
| +Cost of goods manufactured | |
| =Cost of goods available for sale | |
| -Ending finished goods inventory | |
| =Cost of goods sold |
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