Cost of goods manufactured, cost of goods sold, and income statement
Not what you're looking for?
Cost of goods manufactured, cost of goods sold, and income statement. Miller & Co. incurred the following costs during June:
Raw materials purchased $66,150
Direct Labor ($15 per hour) $82,500
Manufacturing Overhead (Actual) $135,450
Selling Expenses $44,700
Administrative Expenses $22,050
Interest Expense $7,660
Manufacturing overhead is applied on the basis of $25 per direct labor hour. Assume that over-applied or under-applied overhead is transferred to cost of goods sold only at the end of the year. During the month, 5,000 units of product were manufactured and 5,300 units of product were sold. On June1 and June 30, Miller & Co. carried the following inventory balances:
June 1 June 30
Raw Materials $27,440 $25,060
Work In Process $74,480 $79,760
Finished Goods $58,520 $41,525
Required:
a. Prepare a statement of cost of goods manufactured for the month of June and calculate the average cost per unit of product manufactured,
b. Calculate the cost of goods sold during June.
c. Calculate the difference between cost of goods manufactured and cost of goods sold. How will this amount be reported in the financial statements?
d. Prepare a traditional (absorption) income statement for Miller & Co. for the month of June. Assume that sales for the month were $413,400 and the company's effective income tax rate was 40%.
Purchase this Solution
Solution Summary
This solution is comprised of a detailed explanation to answer the request of the assignment of more than 300 words of text.
Solution Preview
Cost of goods manufactured, cost of goods sold, and income statement. Miller & Co. incurred the following costs during June:
Raw materials purchased $66,150
Direct Labor ($15 per hour) $82,500
Manufacturing Overhead (Actual) $135,450
Selling Expenses $44,700
Administrative Expenses $22,050
Interest Expense $7,660
Manufacturing overhead is applied on the basis of $25 per direct labor hour. Assume that over-applied or under-applied overhead is transferred to cost of goods sold only at the end of the year. During the month, 5,000 units of product were manufactured and 5,300 units of product were sold. On June1 and June 30, Miller & Co. carried the following inventory ...
Purchase this Solution
Free BrainMass Quizzes
Marketing Research and Forecasting
The following quiz will assess your ability to identify steps in the marketing research process. Understanding this information will provide fundamental knowledge related to marketing research.
Introduction to Finance
This quiz test introductory finance topics.
Organizational Leadership Quiz
This quiz prepares a person to do well when it comes to studying organizational leadership in their studies.
Business Ethics Awareness Strategy
This quiz is designed to assess your current ability for determining the characteristics of ethical behavior. It is essential that leaders, managers, and employees are able to distinguish between positive and negative ethical behavior. The quicker you assess a person's ethical tendency, the awareness empowers you to develop a strategy on how to interact with them.
SWOT
This quiz will test your understanding of the SWOT analysis, including terms, concepts, uses, advantages, and process.