Question

Required information

The following selected account balances are provided for Delray Mfg.

Sales	$	1,250,000
Raw materials inventory, Dec. 31, 2016		37,000
Work in process inventory, Dec. 31, 2016		53,900
Finished goods inventory, Dec. 31, 2016		62,750
Raw materials purchases		175,600
Direct labor		225,000
Factory computer supplies used		17,840
Indirect labor		47,000
Repairs—Factory equipment		5,250
Rent cost of factory building		57,000
Advertising expense		94,000
General and administrative expenses		129,300
Raw materials inventory, Dec. 31, 2017		42,700
Work in process inventory, Dec. 31, 2017		41,500
Finished goods inventory, Dec. 31, 2017		67,300

Prepare its schedule of cost of goods manufactured for the year ended December 31, 2017.

DELRAY MFG.Schedule of Cost of Goods ManufacturedFor Year Ended December 31, 2017Direct materials:Raw materials available for useDirect materials usedFactory overhead:Total factory overhead costsTotal manufacturing costsTotal cost of work in processCost of goods manufactured

Answer 1

Solution

DELRAY MFG
Cost of Goods manufactured
For the year ended December 31, 2017
Direct materials
Direct materials inventory, December 31, 2016	$ 37,000
Direct materials purchases	$ 175,600
Cost of direct materials available for use	$ 212,600
Direct materials inventory, December 31, 2017	$ 42,700
Cost of direct materials placed in production		$ 169,900
Direct labor		$ 225,000
Factory overhead
Indirect Labor	$ 47,000
Factory Computer supplies used	$ 17,840
Repairs—Factory equipment	$ 5,250
Rent Expenses-Factory	$ 57,000
Total Factory Overheads		$ 127,090
Total Manufacturing Cost		$ 521,990
Less: Work in process inventory, December 31, 2016		$ 53,900
Total work in process during the period		$ 575,890
Less: Work in process inventory, December 31, 2017		$ 41,500
Costs of good manufactured		$ 534,390