Question

1. Sleep Tight manufactures comforters. The estimated inventories on January 1 for finished goods, work in process, and materials were $37,000, $34,000 and $25,000 respectively. The desired inventories on December 31 for finished goods, work in process, and materials were $44,000, $33,000 and $19,000 respectively. Direct material purchases were $575,000. Direct labor was $206,000 for the year. Factory overhead was $147,000.

   Prepare a cost of goods sold budget for Sleep Tight, Inc.

   Sleep Tight, Inc.
   Cost of Goods Sold Budget
   For the Year Ending December 31
   Finished goods inventory, January 1			$
   Work in process inventory, January 1		$
   Direct materials:
   Direct materials, January 1	$
   Direct materials purchases
   Cost of direct materials available for sale	$
   Less direct materials inventory, December 31
   Cost of direct materials placed in production	$
   Direct labor
   Factory overhead
   Total manufacturing costs
   Total work in process during the period		$
   Less work in process inventory, December 31
   Cost of goods manufactured
   Cost of finished goods available for sale			$
   Less finished goods inventory, December 31
   Cost of goods sold

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Answer 1

Sleep tight inc
Cost of Goods Sold Budget
For the year ending december 31
	$	$	$
Finished goods inventory ,January 1			37,000
Work in process inventory,Jan 1		34,000
Direct materials ,Jan1	25,000
Direct material purchases	5,75,000
cost of direct materials available for sale	6,00,000
Less direct materials inventory,Dec 31	-19,000
cost of direct materials placed in production	5,81,000
direct labor	2,06,000
factory overhead	1,47,000
Total manufacturing costs		9,34,000
Total work in process during the period		9,68,000
Less Work in process inventory,december 31		-33,000
cost of goods manufactured			9,35,000
cost of finished goods available for sale			9,72,000
Less finished goods inventory,dec 31			-44,000
cost of goods sold			9,28,000