Connect 2-Semester Access Card for Fundamental Accounting Principles
22nd Edition
ISBN: 9780077632755
Author: John Wild
Publisher: McGraw-Hill Education
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Question
Chapter 18, Problem 3BPSB
Requirement-1:
To determine
To Prepare: The Schedule of Cost of Goods Manufactured
Requirement-1:
Expert Solution
Answer to Problem 3BPSB
Solution: The Schedule of Cost of Goods Manufactured is as follows:
Best Bikes | |||
Schedule of Cost of Goods Manufactured | |||
For the year 2015 | |||
Raw Material Used | $ 864,320 | ||
Direct Labor | $ 562,500 | ||
$ 35,400 | |||
Factory Supervision | $ 121,500 | ||
Factory Supplies used | $ 6,060 | ||
Factory Utilities | $ 37,500 | ||
Indirect Labor | $ 59,000 | ||
Misc. Production Costs | $ 8,440 | ||
Rent Expense-Factory Building | $ 93,500 | ||
Maintenance Expense- Factory Equipment | $ 30,375 | ||
Total Overhead Costs | $ 391,775 | ||
Total | $ 1,818,595 | ||
Work in process , December 31, 2014 | $ 12,500 | ||
Work in process , December 31, 2015 | $ 14,100 | ||
Cost of Goods Manufactured | $ 1,816,995 |
Explanation of Solution
Explanation: The Schedule of Cost of Goods Manufactured is prepared as follows:
Best Bikes | |||
Schedule of Cost of Goods Manufactured | |||
For the year 2015 | |||
Raw Material Purchases (A) | $ 894,375 | ||
Raw Materials, December 31, 2014 (B) | $ 40,375 | ||
Raw Materials, December 31, 2015 (C) | $ 70,430 | ||
Raw Material Used (D) = A+B-C | $ 864,320 | ||
Direct Labor (E) | $ 562,500 | ||
Overhead Costs: | |||
Depreciation Expense-Factory Equipment | $ 35,400 | ||
Factory Supervision | $ 121,500 | ||
Factory Supplies used | $ 6,060 | ||
Factory Utilities | $ 37,500 | ||
Indirect Labor | $ 59,000 | ||
Misc. Production Costs | $ 8,440 | ||
Rent Expense-Factory Building | $ 93,500 | ||
Maintenance Expense- Factory Equipment | $ 30,375 | ||
Total Overhead Costs (F) | $ 391,775 | ||
Total Manufacturing Cost (G) =D+E+F | $ 1,818,595 | ||
Work in process , December 31, 2014 (H) | $ 12,500 | ||
Work in process , December 31, 2015 (I) | $ 14,100 | ||
Cost of Goods Manufactured (H) = G+H-I | $ 1,816,995 |
Requirement-2:
To determine
To Prepare: The Income Statement for the year 2015
Requirement-2:
Expert Solution
Answer to Problem 3BPSB
Solution: The Income Statement for the year 2015 is as follows:
Best Bikes | |||
Income Statement | |||
For the year 2015 | |||
Sales | $ 4,942,625 | ||
Cost of Goods Sold | $ 1,852,445 | ||
Gross Profit | $ 3,090,180 | ||
Selling Expenses: | |||
Advertising Expenses | $ 20,250 | ||
Depreciation Expense-Selling Equipment | $ 10,125 | ||
Rent Expense-Selling Space | $ 27,000 | ||
Sales Salaries Expense | $ 295,300 | ||
Total Selling Expenses | $ 352,675 | ||
General and Administrative Expenses: | |||
Depreciation Expense-Office Equipment | $ 8,440 | ||
Office Salaries Expense | $ 70,875 | ||
Rent Expense-Office Space | $ 23,625 | ||
Total General and Administrative Expenses | $ 102,940 | ||
Net Income before Taxes | $ 249,735 | ||
Taxes | $ 136,700 | ||
Net Income | $ 113,035 |
Explanation of Solution
Explanation: The Income Statement for the year 2015 is prepared as follows:
Best Bikes | |||
Income Statement | |||
For the year 2015 | |||
Sales (A) | $ 4,942,625 | ||
Cost of Goods Sold (B) | $ 1,852,445 | ||
Gross Profit (C) = A-B = | $ 3,090,180 | ||
Selling Expenses: | |||
Advertising Expenses | $ 20,250 | ||
Depreciation Expense-Selling Equipment | $ 10,125 | ||
Rent Expense-Selling Space | $ 27,000 | ||
Sales Salaries Expense | $ 295,300 | ||
Total Selling Expenses (D) | $ 352,675 | ||
General and Administrative Expenses: | |||
Depreciation Expense-Office Equipment | $ 8,440 | ||
Office Salaries Expense | $ 70,875 | ||
Rent Expense-Office Space | $ 23,625 | ||
Total General and Administrative Expenses (E) | $ 102,940 | ||
Net Income before Taxes (F) = C-D-E = | $ 249,735 | ||
Taxes (G) | $ 136,700 | ||
Net Income (F-G) | $ 113,035 |
Working note:
Best Bikes | |||
Schedule of Cost of Goods Manufactured | |||
For the year 2015 | |||
Raw Material Purchases (A) | $ 894,375 | ||
Raw Materials, December 31, 2014 (B) | $ 40,375 | ||
Raw Materials, December 31, 2015 (C) | $ 70,430 | ||
Raw Material Used (D) = A+B-C | $ 864,320 | ||
Direct Labor (E) | $ 562,500 | ||
Overhead Costs: | |||
Depreciation Expense-Factory Equipment | $ 35,400 | ||
Factory Supervision | $ 121,500 | ||
Factory Supplies used | $ 6,060 | ||
Factory Utilities | $ 37,500 | ||
Indirect Labor | $ 59,000 | ||
Misc. Production Costs | $ 8,440 | ||
Rent Expense-Factory Building | $ 93,500 | ||
Maintenance Expense- Factory Equipment | $ 30,375 | ||
Total Overhead Costs (F) | $ 391,775 | ||
Total Manufacturing Cost (G) =D+E+F | $ 1,818,595 | ||
Work in process , December 31, 2014 (H) | $ 12,500 | ||
Work in process , December 31, 2015 (I) | $ 14,100 | ||
Cost of Goods Manufactured (H) = G+H-I | $ 1,816,995 | ||
Cost of Goods Manufactured (H) | $ 1,816,995 | ||
Finished Goods , December 31, 2014 (I) | $ 177,200 | ||
Finished Goods , December 31, 2015 (J) | $ 141,750 | ||
Cost of Goods Sold (K) =H+I-J | $ 1,852,445 |
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Chapter 18 Solutions
Connect 2-Semester Access Card for Fundamental Accounting Principles
Ch. 18 - Prob. 1DQCh. 18 - Prob. 2DQCh. 18 - Prob. 3DQCh. 18 - Prob. 4DQCh. 18 - Prob. 5DQCh. 18 - Prob. 6DQCh. 18 - Prob. 7DQCh. 18 - Prob. 8DQCh. 18 - Prob. 9DQCh. 18 - Prob. 10DQ
Ch. 18 - Prob. 11DQCh. 18 - Prob. 12DQCh. 18 - Prob. 13DQCh. 18 - Prob. 14DQCh. 18 - Prob. 15DQCh. 18 - Prob. 16DQCh. 18 - Prob. 17DQCh. 18 - Prob. 18DQCh. 18 - Prob. 19DQCh. 18 - List the four components of a schedule of cost of...Ch. 18 - Prepare a proper title for the annual schedule of...Ch. 18 - Describe the relations among the income statement,...Ch. 18 - Prob. 23DQCh. 18 - Prob. 24DQCh. 18 - Prob. 25DQCh. 18 - Prob. 1QSCh. 18 - Prob. 2QSCh. 18 - Prob. 3QSCh. 18 - Classifying product costs C2 Identify each of the...Ch. 18 - Prob. 5QSCh. 18 - Prob. 6QSCh. 18 - Prob. 7QSCh. 18 - Prob. 8QSCh. 18 - Prob. 9QSCh. 18 - Prob. 10QSCh. 18 - Prob. 11QSCh. 18 - Prob. 12QSCh. 18 - Prob. 13QSCh. 18 - QS 18-17
Raw materials inventory...Ch. 18 - Prob. 1ECh. 18 - Prob. 2ECh. 18 - Prob. 3ECh. 18 - Prob. 4ECh. 18 - Prob. 5ECh. 18 - Prob. 6ECh. 18 - Prob. 7ECh. 18 - Prob. 8ECh. 18 - Prob. 9ECh. 18 - Prob. 10ECh. 18 - Prob. 11ECh. 18 - Prob. 12ECh. 18 - Prob. 13ECh. 18 - Prob. 14ECh. 18 - Prob. 15ECh. 18 - Prob. 16ECh. 18 - Prob. 17ECh. 18 - Prob. 1APSACh. 18 - Prob. 2APSACh. 18 - Prob. 3APSACh. 18 - Problem 18-4A Ending inventory computation and...Ch. 18 - Prob. 5APSACh. 18 - Prob. 1BPSBCh. 18 - Prob. 2BPSBCh. 18 - Prob. 3BPSBCh. 18 - Prob. 4BPSBCh. 18 - Prob. 5BPSBCh. 18 - Prob. 18SPCh. 18 - Prob. 1BTNCh. 18 - Prob. 2BTNCh. 18 - Prob. 3BTNCh. 18 - Prob. 4BTNCh. 18 - Prob. 5BTNCh. 18 - Prob. 6BTNCh. 18 - Prob. 7BTNCh. 18 - Prob. 8BTNCh. 18 - Prob. 9BTN
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