Question 5 27 marks

Supreme Furniture Manufacturing Corporation makes high end office furniture. The company suffered extensive water damage in the accounting department when the candles on their 75^th anniversary cake set off the sprinkler system. As a result of the damage, the accounting information for June must be reconstructed. The first table below contains information concerning the inventory accounts for the month of June that was salvaged from the damaged records. The second table contains information on the costs incurred by Supreme Furniture in June:

Beginning work in process inventory	$80,000
Ending work in process inventory	$167,000
Beginning raw material inventory	$25,000
Ending raw material inventory	$40,000
Beginning Finished goods inventory	$125,000
Ending Finished goods inventory	$120,000

	Insurance on factory building	$ 42,000
	Oak and pine wood used in desks and chairs	$ 418,000
	Small amounts of lubricants, resin, and polishing compounds	$ 18,000
	Advertising in trade magazines	$ 70,000
	Rent on leased factory machinery	$ 45,000
	Wages of assembly line workers	$ 575,000
	Salesperson's commissions	$ 90,500
	Depreciation on delivery equipment	$ 9,000
	Depreciation on factory machinery	$12,000
	Wages of factory maintenance workers	$86,000

1. Classify each of the costs incurred by Supreme Furniture using letter codes for the four cost categories as provided below. Place the appropriate letter code to the left of the cost in the table above. (5 marks)

Direct Material Cost DM

Direct Labour Cost DL

Manufacturing Overhead Cost OH

Period Cost PC

2. Calculate the cost of the raw materials purchased in June. (3 marks)

3. What was the value of the goods transferred from WIP to finished goods during June? (3 marks)

4. What was total manufacturing overhead cost for June ? (3 marks)

5. What was total product cost for June? (3 marks)

6. If goods sold during June were sold for 40% above their costs, what was total sales revenue for June? (2 mark)

7. Prepare a Formal cost of goods manufactured schedule for the month of June. (8 marks)