The following trial balance was taken from the records of Fairport Manufacturing Company at the beginning of Year 3.
Cash Raw materials inventory Work in process inventory Finished goods inventory Property, plant, and equipment Accumulated depreciation Common stock Retained earnings Total $20,000 1,800 2,400 4,200 15,000 $ 6,000 16,800 20,600 $43,400 $43,400 Transactions for the Accounting Period 1. Fairport purchased $11,400 of direct raw materials and $600 of indirect raw materials on account. The indirect materials are capitalized in the Production Supplies account. Materials requisitions showed that $10,800 of direct raw materials had been used for production during the period. The use of indirect materials is determined at the end of the year by physically counting the supplies on hand. 2. By the end of the year, $10,500 of the accounts payable had been paid in cash. 3. During the year, direct labor amounted to 950 hours recorded in the Wages Payable account at $21 per hour. 4. By the end of the year, $18,000 of wages payable had been paid in cash. 5. At the beginning of the year, the company expected overhead cost for the period to be $12,600 and 1,000 direct labor hours to be worked. Overhead is allocated based on direct labor hours, which, as indicated in Event 3, amounted to 950 for the year. 6. Selling and administrative expenses for the year amounted to $1,800 paid in cash. 7. Utilities and rent for production facilities amounted to $9,300 paid in cash. 8. Depreciation on the plant and equipment used in production amounted to $3,000. 9. There was $24,000 of goods completed during the year. 10. There was $25,500 of finished goods inventory sold for $36,000 cash. 11. A count of the production supplies revealed a balance of $178 on hand at the end of the year. 12. Any over- or underapplied overhead is considered to be insignificant. Required a. Prepare T-accounts with the beginning balances shown in the preceding list and record all transactions for the year including closing entries in the T-accounts. b. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet Req A Req B CGM Sched Req B Inc Stmt Req B Bal Sheet Prepare T-accounts with the beginning balances shown in the preceding list and record all transactions for th entries in the T-accounts. Cash Accounts Payable Beg. Bal. Beg. Bal. End. Bal. End. Bal. Raw Materials Wages Payable Beg. Bal. Beg. Bal. End. Bal. End. Bal. Manufacturing Overhead Common Stock Beg. Bal. End. Bal. End. Bal. 0 0 Work in Process Retained Earnings Beg. Bal. Beg. Bal. (cl) End. Bal. End. Bal. Finished Goods Sales Revenue Beg. Bal. (cl) End. Bal. 0 End. Bal. Production Supplies Cost of Goods Sold (cl) End. Bal. End. Bal. 0 0 Property, Plant, and Equipment Selling and Administrative Expenses (cl) Beg. Bal. End. Bal. End. Bal. 0 0 Accumulated Depreciation Beg. Bal. Req A Req B CGM Req B Inc Req B Bal Sched Stmt Sheet Prepare a schedule of cost of goods manufactured and sold. FAIRPORT MANUFACTURING COMPANY Cost of Goods Manfactured and Sold For the Year Ended December, Year 3 Raw materials available 0 Raw materials used 0 Total manufacturing costs 0 Total work in process inventory 0 Cost of goods manufactured 0 Goods available 0 Cost of goods sold 0 Req A Req B CGM Sched Req B Inc Stmt Req B Bal Sheet Prepare an income statement. FAIRPORT MANUFACTURING COMPANY Income Statement For the Year Ended December, Year 3 0 $ 0 Req A Req B CGM Sched Req B Inc Stmt Req B Bal Sheet Prepare a balance sheet. (Amounts to be deducted should be indicated by a mi FAIRPORT MANUFACTURING COMPANY Balance Sheet for Year 3 At December, Year 3 Assets Total assets 0 Liabilities Equity Total equity $ 0
