Transactions for the Accounting Period

Perez purchased $$6,100$ of direct raw materials and $$340$ of indirect raw materials on account. The indirect materials are capitalized

in the Production Supplies account. Materials requisitions showed that $$5,800$ 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.

By the end of the year, $$5,320$ of the accounts payable had been paid in cash.

During the year, direct labor amounted to $1,000$ hours recorded in the Wages Payable account at $$10\mathrm{.}20$ per hour.

By the end of the year, $$9,300$ of wages payable had been paid in cash.

At the beginning of the year, the company expected overhead cost for the period to be $$6,405$ and $1,050$ direct labor hours to be

worked. Overhead is allocated based on direct labor hours, which, as indicated in Event $3,$ amounted to $1,000$ for the year.

Selling and administrative expenses for the year amounted to $$1,000$ paid in cash.

Utilities and rent for production facilities amounted to $$4,660$ paid in cash.

Depreciation on the plant and equipment used in production amounted to $$1,580.$

There was $$11,700$ of goods completed during the year.

There was $$12,150$ of finished goods inventory sold for $$18,400$ cash.

A count of the production supplies revealed a balance of $$92$ on hand at the end of the year.

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$-1.$ Prepare a schedule of cost of goods manufactured and sold.

b$-2.$ Prepare an income statement.

b$-3.$ Prepare a balance sheet.

T$-$accounts are cash, A$/$P$,$ raw materials, wages payable, MOH, C$/$S$,$ WIP, RE$,$ Finished Goods, Sales Revenue, Production Supplies, COGS, PPE, SGA, and Accumulated Depreciation $\backslash$begin$\{$tabular$\}\{|$l$|$r$|\}$

$\backslash$hline $\backslash$multicolumn$\{2\}\{|$c$|\}\{$ PEREZ MANUFACTURING COMPANY $\}\backslash \backslash$

$\backslash$hline $\backslash$multicolumn$\{1\}\{|$c$|\}\{$ Fost of Goods Manfactured and Sold $\}\backslash \backslash$

$\backslash$hline Beginning raw materials inventory & $\backslash (\backslash$$ $\backslash )\backslash \backslash$

$\backslash$hline Purchases & $790\backslash \backslash$

$\backslash$hline Raw materials available & $6,440\backslash \backslash$

$\backslash$hline Ending raw materials inventory & $7,230\backslash \backslash$

$\backslash$hline Raw materials used & $1,090\backslash \backslash$

$\backslash$hline Labor & $6,140\backslash \backslash$

$\backslash$hline Manufacturing overhead & $\backslash \backslash$

$\backslash$hline Total manufacturing costs & $\backslash \backslash$

$\backslash$hline Beginning work in process inventory & $6,140\backslash \backslash$

$\backslash$hline Total work in process inventory & $\backslash \backslash$

$\backslash$hline & $6,140\backslash \backslash$

$\backslash$hline Cost of goods manufactured & $6,140\backslash \backslash$

$\backslash$hline & $\backslash \backslash$

$\backslash$hline Goods available & $6,140\backslash \backslash$

$\backslash$hline & $\backslash \backslash$

$\backslash$hline Cost of goods sold & $6,140\backslash \backslash$

$\backslash$hline $\backslash$hline

$\backslash$end$\{$tabular$\}$ FAIRPORT MANUFACTURING COMPANY

Income Statement

For the Year Ended December, Year $3$