Question

URGENT

ABC company provide the following cost data for 2020:

Sales

$450,000

Materials 01/01/2020

$24,000

Materials 12/31/2020

$18,000

Purchases of Materials

$66,000

Direct labor

$20,000

Manufacturing overhead

$100,000

Administrative expenses

$90,000

Selling expenses

$80,000

Work in process 01/01/2020

$50,000

Work in process 12/31/2020

$62,000

Finished Goods 01/01/2020

$120,000

Finished Goods 12/31/2020

$85,000

What is the net operating income for 2020?

Answer 1

Particulars	Amount (in $ )
Work in process 01/01/2020	$ 50,000
Add: Materials 01/01/2020	$ 24,000
Add: purchase of Materials	$ 66,000
Less: Materials 12/31/2020	( $ 18,000)
Materials used in Production	$ 122,000
Add: Direct labor	$ 20,000
Add: Manufacturing overhead	$ 100,000
Total Manufacturing Costs	$ 242,000
Less: Work in process 12/31/2020	($ 62,000)
Cost of goods Manufactured	$ 180,000
Add: Finished Goods 01/01/2020	$ 120,000
Less: Finished Goods 12/31/2020	($ 85,000)
Cost of Goods Sold	$ 215,000
Particulars	Amount (in $ )
Sales	$ 450,000
Less: Cost of Goods Sold	($ 215,000)
Gross Profit	$ 235,000
Less: Administrative expenses	($ 90,000)
Less: Selling expenses	($ 80,000)
Net Operating Income for 2020	$ 65,000