Question

Sales and Production Budgets The Taipei Manufacturing Company is in the process of preparing a budgeted...

Sales and Production Budgets

The Taipei Manufacturing Company is in the process of preparing a budgeted schedule of cost of goods manufactured for May 2017. The following data has been gathered:

                                               

Sales Revenue………………          $2,000

Direct Materials Purchased….           500

Direct Labor………                              600

Allocated Factory Overhead…          400

Inventory Levels:

                                                            May 1                                     May 31          

Direct Materials                                $70                                          $50

Work in Process                               20                                          10

Finished Goods                                50                                          40

Required:

  1. What is the budgeted cost of direct materials usage for May?

b.   What is the budgeted cost of goods manufactured for May?

c.   What is the budgeted cost of goods sold for May?

Homework Answers

Answer #1

a.

Direct Materials , beginning 70
Direct material purchased 500
Total direct material available 570
Direct Materials , ending -50
Direct material used $520

Direct material usage for may = $520

b.

Schedule of cost of goods manufactured

Direct material used 520
Direct Labor 600
Allocated Factory Overhead 400
Total manufacturing cost 1,520
Work in Process , beginning 20
Work in Process , ending -10
cost of goods manufactured $1,530

cost of goods manufactured = $1,530

c.

Schedule of cost of goods sold

Finished Goods, beginning 50
cost of goods manufactured 1,530
Cost of goods available for sale 1,580
Finished Goods, ending -40
cost of goods sold $1,540

cost of goods sold = $1,540

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