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Blue Line Products Statement of Cost of Goods Manufacturing

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Information about Blue Line Products Company for Dec 31 include:

Sales $580,000
Direct materials used $105,000
Manufacturing overhead predetermined overhead rate is 200% of direct labor cost (dollars not hours)
Beginning finished goods inventory is 25% of cost of goods sold
Ending finished goods inventory is 1.5 times beginning finished goods inventory
Gross profit is 205 of sales
There is no beginning or ending work in process inventory

Prepare a statement of cost of goods manufactured (not COGS) for teh year.

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Solution Summary

Takes three steps, working backwards from sales to COGM to labor and overhead to solve this. Excel file shows process.

Solution Preview

First step: solve for COGS
Second step: solve for beg/end FG and then ...

Solution provided by:
Carol Sargent, PhD
Education
  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
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