Question
Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies for the month of December. On
Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies for the month of December.
| On Company | Off Company | |||
| Materials inventory, December 1 | $73,030 | $97,130 | ||
| Materials inventory, December 31 | (a) | 109,760 | ||
| Materials purchased | 185,500 | (a) | ||
| Cost of direct materials used in production | 195,720 | (b) | ||
| Direct labor | 275,320 | 218,540 | ||
| Factory overhead | 85,450 | 108,790 | ||
| Total manufacturing costs incurred in December | (b) | 628,430 | ||
| Total manufacturing costs | 696,710 | 862,510 | ||
| Work in process inventory, December 1 | 140,220 | 234,080 | ||
| Work in process inventory, December 31 | 118,310 | (c) | ||
| Cost of goods manufactured | (c) | 622,600 | ||
| Finished goods inventory, December 1 | 123,420 | 108,790 | ||
| Finished goods inventory, December 31 | 129,260 | (d) | ||
| Sales | 1,076,460 | 971,300 | ||
| Cost of goods sold | (d) | 628,430 | ||
| Gross profit | (e) | (e) | ||
| Operating expenses | 140,220 | (f) | ||
| Net income | (f) | 215,630 | ||
Required:
1. Determine the amounts of the missing items, identifying them by letter. Enter all amounts as positive numbers.
| Letter | On Company | Off Company |
| a. | $ | $ |
| b. | $ | $ |
| c. | $ | $ |
| d. | $ | $ |
| e. | $ | $ |
| f. | $ | $ |
2. Prepare On Company's statement of cost of goods manufactured for December.
| On Company | |||
| Statement of Cost of Goods Manufactured | |||
| For the Month Ended December 31 | |||
| Work in process inventory, December 1 | $ | ||
| Direct materials: | |||
| Materials inventory, December 1 | $ | ||
| Purchases | |||
| Cost of materials available for use | $ | ||
| Less materials inventory, December 31 | |||
| Cost of direct materials used in production | $ | ||
| Direct labor | |||
| Factory overhead | |||
| Total manufacturing costs incurred during December | |||
| Total manufacturing costs | $ | ||
| Less work in process inventory, December 31 | |||
| Cost of goods manufactured | $ | ||
3. Prepare On Company's income statement for December.
| On Company | ||
| Income Statement | ||
| For the Month Ended December 31 | ||
| Sales | $ | |
| Cost of goods sold: | ||
| Finished goods inventory, December 1 | $ | |
| Cost of goods manufactured | ||
| Cost of finished goods available for sale | $ | |
| Less finished goods inventory, December 31 | ||
| Cost of goods sold | ||
| Gross profit | $ | |
| Operating expenses | ||
| Net income | $ | |
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Internal Auditing Assurance And Advisory Services
Authors: Kurt R. Reding, Paul J. Sobel, Urton L. Anderson, Michael J. Head, Sridhar Ramamoorti, Mark Salamasick, Cris Riddle
5th Edition
1634541367, 978-1634541367
