Problem 11-17A (Algo) Manufacturing cost flow across three accounting cycles LO 11-1, 11-2, 11-3 The following accounting events affected Finch Manufacturing Company during its first three years of operation. Assume that all transactions are cash transactions. Transactions for Year 1 1. Started manufacturing company by issuing common stock for $3,300. 2. Purchased $1,270 of direct raw materials. 3. Used $790 of direct raw materials to produce inventory. 4. Paid $380 of direct labor wages to employees to make inventory. 5. Applied $250 of manufacturing overhead cost to Work in Process Inventory. 6. Finished work on inventory that cost $970. 7. Sold goods that cost $630 for $1,160. 8. Paid $330 for selling and administrative expenses. 9. Actual manufacturing overhead cost amounted to $226 for the year. Transactions for Year 2 1. Acquired additional $1,000 of cash from common stock. 2. Purchased $1,290 of direct raw materials. 3. Used $1,230 of direct raw materials to produce inventory. 4. Paid $600 of direct labor wages to employees to make inventory. 5. Applied $280 of manufacturing overhead cost to Work in Process Inventory. 6. Finished work on inventory that cost $1,870. 7. Sold goods that cost $1,510 for $2,860. 8. Paid $460 for selling and administrative expenses. 9. Actual manufacturing overhead cost amounted to $360 for the year. Transactions for Year 3 1. Paid a cash dividend of $700. 2. Purchased $1,500 of direct raw materials. 3. Used $1,180 of direct raw materials to produce inventory. 4. Paid $440 of direct labor wages to employees to make inventory. 5. Applied $320 of manufacturing overhead cost to work in process. 6. Finished work on inventory that cost $2,070. 7. Sold goods that cost $2,220 for $3,530. 8. Paid $700 for selling and administrative expenses. 9. Annual manufacturing overhead costs were $260 for the year. Required a.c.&d. Record the preceding events in horizontal statements models for each of the three years. Close overapplied or underapplied overhead to Cost of Goods Sold. Close appropriate accounts for Year 1, Year 2, and Year 3. In Year 1, the first event is shown as an example. b.&d. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet as of the close of business on December 31, Year 1, Year 2 and Year 3. Complete this question by entering your answers in the tabs below. Year 1 Horizontal Year 2 Horizontal Year 3 Horizontal CGM Schedule Financial Stmts Record the preceding events in horizontal statements models for each of the three years. Close overapplied or underapplied overhead to Cost of Goods Sold. first event is shown as an example. (Enter decreases to account balances with a minus sign.) Year 3 Horizontal Assets Equity Event No. Cash + Raw Materials + Manufacturing Overhead Cost Work in Process Finished Goods Common Stock Retaining Earnings Revenue Expenses = Net Income 1 $ 3,300 + + = $ 3,300 + = 2 + + + + + = = 1 3 + + = + = 4 + + + = + =r 5 5 + + + = 6 + + = + = 7a + + + + + 7b + + + + = + 8 + + + + = + = 9 + + + = + - = CL + + + + + = Total $ 3,300 + $ 0 + $ 0 + $ 01 + $ 0 = $ 3,300 + $ 0 $ 0 - $ 0= $ 0 Complete this question by entering your answers in the tabs below. Year 1 1 Horizontal Year 2 Horizontal Year 3 Horizontal CGM Schedule Financial Stmts Record the preceding events in horizontal statements models for each of the three years. Close overapplied or underapplied overhead to Cost of Goods Sold. Year 1, the first event is shown as an example. (Enter decreases to account balances with a minus sign.) Event No. Equity Common Retaining Stock Earnings Assets Manufacturing Overhead Cost Cash Raw Materials + + Work in Process Finished Goods Revenue Expenses = Net Income B.B. + 1 + + + + + 1+ 2 + + + 3 +1 + + + 1 = 4 + + + + 5 + + + + 1 6 + + 7a + + 7b + + + 8 + + + 1 1- 9 + + + + + CL + + + + = Total $ 0 0 + $ $ 0 + $ 0 + $ 0 + $ 0 = $ 0 + $ 0 $ 0 0 - $ 0 = $ 0 Complete this question by entering your answers in the tabs below. Year 1 Horizontal Year 2 Horizontal Year 3 Horizontal CGM Schedule Financial Stmts Record the preceding events in horizontal statements models for each of the three years. Close overapplied or underapplied overhead to Cost of Goods Sold. Year 1, the first event is shown as an example. (Enter decreases to account balances with a minus sign.) Event No. Assets Manufacturing Overhead Cost Raw Materials Cash Work in Process Equity Common Retaining Stock Earnings Finished Goods Revenue Expenses = Net Income B.B. + + 1 + + + = 2 + + + 3 + + + + 4 + + = -1 5 + + 6 + + = 1 - 7a + + =1 7b + + + = 8 + + + = 9 + + + + + =1 - CL + + + + + Total $ 0 0 + $ 0 + $ 0 + $ $ 0 + $ 0 = $ 0 = 0 + $ 0 $ 0 - $ 0 = $ = $ 0 Year 1 Horizontal Year 2 Horizontal Year 3 Horizontal CGM Schedule Financial Stmts Prepare a schedule of cost of goods manufactured and sold for Year 1, Year 2 and Year 3. FINCH MANUFACTURING COMPANY Cost of Goods Manufactured and Sold Schedule Year 1 Year 2 Year 3 Raw materials available 0 0 ol Raw materials used 0 0 0 Total manufacturing costs 0 0 0 Total work in process inventory 0 0 0 Cost of goods manufactured 0 0 0 Goods available for sale 0 0 0 Cost of goods sold $ 0 $ 0 $ 0 FINCH MANUFACTURING COMPANY Financial Statements Year 1 Year 2 Year 3 Income Statements 0 0 0 $ 0 $ 0 $ 0 Balance Sheets Assets Total assets $ 0 $ 0 $ 0 Equity Total equity $ 0 $ 0 $ 0 Problem 11-17A (Algo) Manufacturing cost flow across three accounting cycles LO 11-1, 11-2, 11-3 The following accounting events affected Finch Manufacturing Company during its first three years of operation. Assume that all transactions are cash transactions. Transactions for Year 1 1. Started manufacturing company by issuing common stock for $3,300. 2. Purchased $1,270 of direct raw materials. 3. Used $790 of direct raw materials to produce inventory. 4. Paid $380 of direct labor wages to employees to make inventory. 5. Applied $250 of manufacturing overhead cost to Work in Process Inventory. 6. Finished work on inventory that cost $970. 7. Sold goods that cost $630 for $1,160. 8. Paid $330 for selling and administrative expenses. 9. Actual manufacturing overhead cost amounted to $226 for the year. Transactions for Year 2 1. Acquired additional $1,000 of cash from common stock. 2. Purchased $1,290 of direct raw materials. 3. Used $1,230 of direct raw materials to produce inventory. 4. Paid $600 of direct labor wages to employees to make inventory. 5. Applied $280 of manufacturing overhead cost to Work in Process Inventory. 6. Finished work on inventory that cost $1,870. 7. Sold goods that cost $1,510 for $2,860. 8. Paid $460 for selling and administrative expenses. 9. Actual manufacturing overhead cost amounted to $360 for the year. Transactions for Year 3 1. Paid a cash dividend of $700. 2. Purchased $1,500 of direct raw materials. 3. Used $1,180 of direct raw materials to produce inventory. 4. Paid $440 of direct labor wages to employees to make inventory. 5. Applied $320 of manufacturing overhead cost to work in process. 6. Finished work on inventory that cost $2,070. 7. Sold goods that cost $2,220 for $3,530. 8. Paid $700 for selling and administrative expenses. 9. Annual manufacturing overhead costs were $260 for the year. Required a.c.&d. Record the preceding events in horizontal statements models for each of the three years. Close overapplied or underapplied overhead to Cost of Goods Sold. Close appropriate accounts for Year 1, Year 2, and Year 3. In Year 1, the first event is shown as an example. b.&d. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet as of the close of business on December 31, Year 1, Year 2 and Year 3. Complete this question by entering your answers in the tabs below. Year 1 Horizontal Year 2 Horizontal Year 3 Horizontal CGM Schedule Financial Stmts Record the preceding events in horizontal statements models for each of the three years. Close overapplied or underapplied overhead to Cost of Goods Sold. first event is shown as an example. (Enter decreases to account balances with a minus sign.) Year 3 Horizontal Assets Equity Event No. Cash + Raw Materials + Manufacturing Overhead Cost Work in Process Finished Goods Common Stock Retaining Earnings Revenue Expenses = Net Income 1 $ 3,300 + + = $ 3,300 + = 2 + + + + + = = 1 3 + + = + = 4 + + + = + =r 5 5 + + + = 6 + + = + = 7a + + + + + 7b + + + + = + 8 + + + + = + = 9 + + + = + - = CL + + + + + = Total $ 3,300 + $ 0 + $ 0 + $ 01 + $ 0 = $ 3,300 + $ 0 $ 0 - $ 0= $ 0 Complete this question by entering your answers in the tabs below. Year 1 1 Horizontal Year 2 Horizontal Year 3 Horizontal CGM Schedule Financial Stmts Record the preceding events in horizontal statements models for each of the three years. Close overapplied or underapplied overhead to Cost of Goods Sold. Year 1, the first event is shown as an example. (Enter decreases to account balances with a minus sign.) Event No. Equity Common Retaining Stock Earnings Assets Manufacturing Overhead Cost Cash Raw Materials + + Work in Process Finished Goods Revenue Expenses = Net Income B.B. + 1 + + + + + 1+ 2 + + + 3 +1 + + + 1 = 4 + + + + 5 + + + + 1 6 + + 7a + + 7b + + + 8 + + + 1 1- 9 + + + + + CL + + + + = Total $ 0 0 + $ $ 0 + $ 0 + $ 0 + $ 0 = $ 0 + $ 0 $ 0 0 - $ 0 = $ 0 Complete this question by entering your answers in the tabs below. Year 1 Horizontal Year 2 Horizontal Year 3 Horizontal CGM Schedule Financial Stmts Record the preceding events in horizontal statements models for each of the three years. Close overapplied or underapplied overhead to Cost of Goods Sold. Year 1, the first event is shown as an example. (Enter decreases to account balances with a minus sign.) Event No. Assets Manufacturing Overhead Cost Raw Materials Cash Work in Process Equity Common Retaining Stock Earnings Finished Goods Revenue Expenses = Net Income B.B. + + 1 + + + = 2 + + + 3 + + + + 4 + + = -1 5 + + 6 + + = 1 - 7a + + =1 7b + + + = 8 + + + = 9 + + + + + =1 - CL + + + + + Total $ 0 0 + $ 0 + $ 0 + $ $ 0 + $ 0 = $ 0 = 0 + $ 0 $ 0 - $ 0 = $ = $ 0 Year 1 Horizontal Year 2 Horizontal Year 3 Horizontal CGM Schedule Financial Stmts Prepare a schedule of cost of goods manufactured and sold for Year 1, Year 2 and Year 3. FINCH MANUFACTURING COMPANY Cost of Goods Manufactured and Sold Schedule Year 1 Year 2 Year 3 Raw materials available 0 0 ol Raw materials used 0 0 0 Total manufacturing costs 0 0 0 Total work in process inventory 0 0 0 Cost of goods manufactured 0 0 0 Goods available for sale 0 0 0 Cost of goods sold $ 0 $ 0 $ 0 FINCH MANUFACTURING COMPANY Financial Statements Year 1 Year 2 Year 3 Income Statements 0 0 0 $ 0 $ 0 $ 0 Balance Sheets Assets Total assets $ 0 $ 0 $ 0 Equity Total equity $ 0 $ 0 $ 0