Q.10

Required:

1. Prepare a cost of goods manufactured and sold statement.

2. Prepare an income statement.

Westlake, Inc. produces metal fittings for the aerospace industry. The administrative and manufacturing operations occupy the same 200,000 square foot building. The manufacturing plant uses 150,000 square feet. Depreciation is assigned based on building use. Indirect labor represents 15 percent of the total manufacturing plant labor. The financial information for the year just ended is shown as follows. $ 250 580 24 29 (Thousands of dollars) Administrative costs Total building depreciation Direct materials inventory, January 1 Direct materials inventory, December 31 Direct materials purchased during the year Finished goods inventory, December 31 Indirect labor Maintenance on plant machinery Marketing costs Operating profit Other plant overhead Plant supervision and administration Plant supplies and indirect materials Sales revenue Taxes on manufacturing property Work-in-process inventory, January 1 Work-in-process inventory, December 31 1,579 89 234 149 129 798 92 164 76 5,900 126 89 119 WESTLAKE, INC. Cost of Goods Manufactured and Sold Statement For the Year Ending December 31 (Thousands of Dollars) Manufacturing costs Direct materials: Manufacturing overhead: Manufacturing overhead: 0 Total overhead Total manufacturing costs Total cost of work-in-process during the year Costs of goods manufactured this year Cost of goods available for sale Cost of goods sold WESTLAKE, INC. Income Statement For the Year Ending December 31 (Thousands of Dollars) Total operating costs 0