Survey Of Accounting
5th Edition
ISBN: 9781259631122
Author: Edmonds, Thomas P.
Publisher: Mcgraw-hill Education,
expand_more
expand_more
format_list_bulleted
Videos
Textbook Question
Chapter 10, Problem 24P
Problem 1-22A Product versus SG&A costs
The following transactions pertain to 2018, the first-year operations of Gibson Company. All inventory was started and completed during 2018. Assume that all transactions are cash transactions.
1. Acquired $12,000 cash by issuing common stock.
2. Paid $4,700 for materials used to produce inventory.
3. Paid $2,400 to production workers.
4. Paid $900 rental fee for production equipment.
5. Paid $350 to administrative employees.
6. Paid $400 rental fee for administrative office equipment.
7. Produced 400 units of inventory of which 360 units were sold at a price of $25 each.
Required
Prepare an income statement and a
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
PROBLEM 14: MMM Company started operations in 2019. The following data are abstracted
from the company's production and sales records:
2019
2020
2021
of units
Number
produced
Number of units sold
Unit production cost
116,250
108,750
P 4.50 P 5.20 P 5.80
900,000
120,000
75,000
101,250
97,500
Sales revenue
600,000
975,000
19. Using the FIFO cost flow assumption, the gross profit for the year ended December 31,
2021 is:
PROBLEM 15: The following quarterly cost data have been accumulated for New DDD
Manufacturing, Inc.:
Raw materials, 1/1/2022
Purchases of raw materials
10,000 units at P6.00
8,500 units at P7.00
11,000 units at P7.50
Raw materials transferred to
work in process
Work in process, 1/1/2022
Direct labor
Manufacturing overhead
Work in process, 3/31/2022
21,500 units
5,600 units at P13.50
P 250,000
325,000
4,200 units at P13.75
20. If New Dehi uses the FIFO method for valuing raw materials inventories, compute for the
cost of goods manufactured for the quarter ended March 31,…
Question 1.2
Following are the account balances for the DC Company in 2018:
Beginning of 2018
26,500
Ending of 2018
Direct materials inventory
Work-in-process inventory
Finished-goods inventory
27,000
28,400
22,100
79,000
30,500
16,500
Purchases of direct materials
Direct manufacturing labor
Indirect manufacturing labor
24,500
18,600
Plant insurance
7,900
Depreciation-plant, building, and equipment
Repairs and maintenance-plant
Marketing, distribution, and customer-service costs
11,800
3,500
87,900
General and administrative costs
26,500
Required:
1. Prepare a schedule for the cost of goods manufactured for 2018.
2. Revenues for 2018 was $425,000. Prepare the income statement for 2018.
Additional information:
1. Inventory on 31 March 2021:
Raw materials RM 19,400
Work in progress RM 16,400
Finished goods RM 31,400
2. Utilities and insurance expense are to be apportioned between factory and office in the ratio 2:1.
3. Only 40% of the rent expense and 50% of the general expense apply to factory operations,
the remaining amounts should be charged to administrative activities.
4. Accrued payments:
Factory direct wages RM 2,500
Utilities RM 1,800
5. Depreciation for the year is to be charged as follows:.
Plant and machinery 10% on cost Office equipment 5% on reducing balance method
Required :
a) Prepare statement of cost of goods manufactured for the year ended 31 March 2021.
b) Prepare statement of profit or loss for the year ended 31 March 2021.
c) Prepare statement of financial position as at 31 March 2021.
Chapter 10 Solutions
Survey Of Accounting
Ch. 10 - 1. What are some differences between financial and...Ch. 10 - 2. What does the value-added principle mean as it...Ch. 10 - 4. How does product costing used in financial...Ch. 10 - 5. What does the statement costs can be assets or...Ch. 10 - 6. Why are the salaries of production workers...Ch. 10 - 7. How do product costs affect the financial...Ch. 10 - 8. What is an indirect cost? Provide examples of...Ch. 10 - 9. How does a product cost differ from a selling,...Ch. 10 - 10. Why is cost classification important to...Ch. 10 - 11. What is cost allocation? Give an example of a...
Ch. 10 - 13. What are some of the common ethical conflicts...Ch. 10 - 14. What costs should be considered in determining...Ch. 10 - 15. What is a just-in-time (JIT) inventory system?...Ch. 10 - Prob. 14QCh. 10 - Prob. 15QCh. 10 - Prob. 16QCh. 10 - Prob. 17QCh. 10 - Prob. 18QCh. 10 - Prob. 19QCh. 10 - Prob. 1ECh. 10 - Exercise 1-2A Identifying product versus selling,...Ch. 10 - Prob. 3ECh. 10 - Prob. 4ECh. 10 - Prob. 5ECh. 10 - Exercise 1-6A Identifying product versus SGA costs...Ch. 10 - LO 1-3 Exercise 1-7A Recording product versus SGA...Ch. 10 - Prob. 8ECh. 10 - LO 1-4 Exercise 1-9A Upstream, midstream, and...Ch. 10 - Prob. 10ECh. 10 - Prob. 11ECh. 10 - Prob. 12ECh. 10 - Prob. 13ECh. 10 - Cost of goods manufactured and sold The following...Ch. 10 - Prob. 15ECh. 10 - Exercise 1-14A Using JIT to minimize waste and...Ch. 10 - Prob. 17ECh. 10 - Prob. 18ECh. 10 - Prob. 19ECh. 10 - Prob. 20ECh. 10 - Problem 1-19A Characteristics of financial versus...Ch. 10 - Prob. 22PCh. 10 - Problem 1-21A Effect of product versus period...Ch. 10 - Problem 1-22A Product versus SGA costs The...Ch. 10 - Prob. 25PCh. 10 - Prob. 26PCh. 10 - Prob. 27PCh. 10 - Prob. 28PCh. 10 - Prob. 29PCh. 10 - Prob. 30PCh. 10 - Prob. 31PCh. 10 - Prob. 32PCh. 10 - Prob. 1ATCCh. 10 - Prob. 2ATCCh. 10 - Prob. 3ATCCh. 10 - Prob. 4ATCCh. 10 - Ethical Dilemma Product cost versus selling and...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- PROBLEM 14: MMM Company started operations in 2019. The following data are abstractedfrom the company’s production and sales records: 2019 2020 2021 Number of units produced 120,000 116,250 101,250 Number of units sold 75,000 108,750 97,500 Unit production cost P 4.50 P 5.20 P 5.80 Sales revenue 600,000 900,000 975,000 Using the FIFO cost flow assumption, the gross profit for the year ended December 31, 2021 is:arrow_forwardProblem 15-8 (IAA) to a 5% cash discount which was taken. were price of at a cost of P100,000. of the transactions? a. 4,900,000 b. 5,000,000 c. 5,100,000 d. 5,200,000 Problem 15-9 (IAA) Taiwan Company fabricated equipment for office use durine the current year. The following data were taken from the accounting records: Materials Direct labor Finished goods Office equipment 1,000,000 600,000 1,500,000 500,000 Factory overhead amounted to P1,200,000. Normal production of finished goods is 50,000 units. Due to the fabrication of the office equipment, finished goods produced totaled 35,000 units only in the current year. The office equipment is to be charged with the overhead which would have been apportioned to the 15,000 units which were not produced. apportionment of factory overhead? a. 1,100,000 b. 1,400,000 c. 1,460,000 d. 2,300,000 Acquired a at an invoicearrow_forwardQUESTION 4 The following information was extracted from the accounting records of ABC Manufacturers for the year ended September 2020: UNITS Inventory at the beginning of the year Production for the year Sales for the year (at R75 per unit) Nil 20 000 18 250 Direct Materials cost per unit Direct Labour cost per unit Variable Manufacturing overheads per unit Variable selling and administrative cost per unit Fixed manufacturing overhead cost Fixed selling and administrative cost The company utilises the first-in-first-out method of inventory valuation. 21 7 8 182 000 77 000 REQUIRED: 4.1 Prepare the Income Statement using the Marginal Costing method. 4.2 Prepare the Income Statement using the Absorption Costing method.arrow_forward
- Cost incurred: Direct labor cost Rs. 70,000 Purchases of raw materials 165,000 Manufacturing overhead 85,000 Selling & administrative expenses 142,000 Sales 450,000 Beginning of End of the Year the year Inventories: Raw materials Rs. 8,000 13,000 Work in process 16,000 21,000 Finished goods 40,000 60,000 Prepare a schedule of cost of goods manufactured. Prepare the cost of goods sold section and Income statement of Fast company for the year 2019.arrow_forwardView Policies Current Attempt in Progress The following data has been taken from the accounting records of Curtis Manufacturing Company for the current year: Sales Purchases of direct materials Direct labor cost during period Manufacturing overhead applied during period Direct Materials Inventory, beginning Direct Materials Inventory, ending Work in Process Inventory, beginning Work in Process Inventory, ending Finished Goods Inventory, beginning Finished Goods Inventory, ending (a) Direct materials used in production eTextbook and Media $600,000 Save for Later 350,000 120,000 60,000 20,000 25,000 47,000 32,000 Compute the cost of direct materials moved into production during the period. 75,000 82,000 Attempts: 0 of 4 used Submit Answer (b) The parts of this question must be completed in order. This part will be available when you complete the part above. (c) The parts of this question must be completed in order. This part will be available when you complete the part above.arrow_forwardView Policies Current Attempt in Progress Marigold Corporation incurred the following transactions. 1. 2. 3. 4. 5. 6. 7. 8. 1 Purchased raw materials on account $49,100. Raw Materials of $44,200 were requisitioned to the factory. An analysis of the materials requisition slips indicated that $9,900 was classified as indirect materials. Factory labor costs incurred were $61,900. Time tickets indicated that $55,300 was direct labor and $6,600 was indirect labor. Manufacturing overhead costs incurred on account were $81,900. Manufacturing overhead was applied at the rate of 160% of direct labor cost. Goods costing $93,900 were completed and transferred to finished goods. Finished goods costing $76,400 to manufacture were sold. Record the transactions. (Enter negative amounts using either a negative sign preceding the number eg. -45 or parentheses eg. (45)) ..arrow_forward
- 1.1 REQUIRED Use the first-in-first-out (FIFO) method to complete the table provided below for the stated transactions. INFORMATION The following transactions of Max Enterprises took place during August 2022 in respect of a component used in production: Date Transactions 01 07 15 24 27 30 Opening inventory Purchased from a supplier Date Issued to production Purchased from a supplier Returned to the supplier (see 24") Issued to production Table to complete: Purchases Quantity Price 180 units @ R10 per unit 900 units @ R11 per unit 630 units 540 units @ R12 per unit 100 units 600 units Issues and returns Amount Quantity Price Amount Quantity Balance Price Amountarrow_forward(1)Garcon Company | Pepper Company (2) Finished goods inventory, beginning $ 13,200 / $ 16, 750 Work in process inventory, beginning 18,000/ 22,650 Raw materials inventory, beginning 9, 800/12, 750 Rental cost on factory equipment 30, 250/26, 350 Direct labor 19, 400 / 39,400 Finished goods inventory, ending 17,300 / 16, 400 Work in process inventory, ending 26, 200/20, 400 Raw materials inventory, ending 8, 000/ 9,200 Factory utilities 14, 100/13, 750 General and administrative expenses 27, 500/53, 500 Indirect labor 12, 150 / 12, 260 Repairs-Factory equipment 4, 820/2, 350 Raw materials purchases 47,000/67,500 Selling expenses 62, 400 / 54,400 Sales 295, 320/394, 170 Cash 29, 000/24, 200 Accounts receivable, net 15,800 / 23,450arrow_forwardSales Cost of goods sold Sales returns and allowances Operating expenses: Thompson's Company Income Statement For the Month Ended August 31, 2021 Net income $ 6,700 1,100arrow_forward
- 1. Jorasmi Enterprise Trial Balance as at 31 December 2020 Credit RM Particulars Debit RM Inventory of raw materials 1 Jan 2020 Inventory of finished goods 1 Jan 2020 Work in progress 1 Jan 2020 Wages (direct RM180,000, factory indirect RM145,000) Royalties Carriage inwards (on raw materials) Purchases of raw materials Productive machinery (cost RM280,000) 21,000 38,900 13,500 325,000 7,000 3,500 370 000 230.000 12,000 31,000 7,500 13,700 44,000 Administration computers (cost RM20,000) Coneral factory expenses General Lighting actory power Factory Administration salaries Sales Sales representative salaries Commission on sales Rent 30,000 11,500 12,000 4,200 13,400 2,300 4,800 5,900 Insurance General administration expenses Bank charges Discount allowed Carriage outwards Sales 1,000,000 64,000 Account receivable and accounts payable Bank Cash Drawings Capital as at 1 Jan 2020 142,300 16,800 1,500 60,000 357,800 1,421,800 1,421,800 ТОTAL Prepared by: Puan Siti Nor Junita Mohd Radzi…arrow_forwardCost of Goods Manufactured Cost of Goods Sold Zoolander Inc. manufacturers high end fashion accessories and has provided the following data for the latest quarter ended March 31st: $204,300 $172,750 $4,800 $9,500 $3,800 Property insurance paid on factory Utilities for the factory Indirect materials used in production Sales Revenue Operating Expenses Calculate gross profit for Zoolander Inc.'s first quarter. OA. $271,250 B. $444,000 OC. $449,700 OD. $481,250 question: 1 point(s) $654,000 $210,000 possible Submit quiz Nextarrow_forwardpart c:\ Determine the company’s total cost of goods completed and COGS in December. Total cost of goods completed and COGS $enter the total cost of goods completed and cost of goods sold in dollars part d:arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education
Financial ratio analysis; Author: The Finance Storyteller;https://www.youtube.com/watch?v=MTq7HuvoGck;License: Standard Youtube License