Question

	Beginning		End of			End of
	of Year		Year			Year
Raw materials inventory. . . . . . . .	$23,000		$26,000		Insurance on plant. . . . . . . . . . . . . . . . . . . . . . . .	$11,000
Work in process inventory. . . . . .	$38,000		$34,000		Depreciation-plant building and equipment. . . .	$12,700
Finished goods inventory. . . . . . .	$20,000		$22,000		Repairs and maintenance-plant. . . . . . . . . . . . .	$4,300
Purchases of direct materials. . . .			$73,000		Marketing expenses. . . . . . . . . . . . . . . . . . . .	$77,000
Direct labor. . . . . . . . . . . . . . . .			$89,000		General and administrative expenses. . . . . . . . .	$28,500
Indirect labor. . . . . . . . . . . . . . . . .			$41,000

Clear Bay Company

Calculation of Cost of Goods Sold

For Current Year

Plus:

Less:

Cost of goods sold

.

Answer 1

Solution:

Computation of Cost of Goods Sold
Particulars	Details	Amount
Raw Material inventory - beginning	$23,000.00
Purchases of raw material	$73,000.00
Ending inventory of raw material	$26,000.00
Raw material consumption		$70,000.00
Direct labor		$89,000.00
Manufacturing overhead:
Indirect labor	$41,000.00
Insurance on plant	$11,000.00
Depreciation - Plant building and equipment	$12,700.00
Repairs and maintenance Plant	$4,300.00
Total Manufacturing overhead		$69,000.00
WIP Inventory Beginning		$38,000.00
WIP Inventory Ending		-$34,000.00
Cost of goods manufactured		$232,000.00
Opening inventory of finished goods		$20,000.00
Ending inventory of finished goods		-$22,000.00
Cost of Goods Sold		$230,000.00