Question 1

On 30 June 2020 Smalls Ltd showed following actual costs for the financial year just ended:

Direct material used Direct labour Manufacturing overhead

$300 000 250 000 298 000

The company's planned overhead rate is 120% of direct labour cost. The balances of inventory on 1 July 2019 were as follows:

Raw material Work in process Finished goods

$30 000 40 000 50 000

Each of those inventory balances was 20% higher on 30 June 2020.

Required:

(a) Prepare a Schedule of Cost of Goods Manufactured for the financial year; (5 marks) (b) Calculate the Cost of Goods Sold for the financial year. (5 marks)