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Q. (Required) Newark Manufacturieg produces LCD touch skeen products. The cempun...

Mar 25, 2024

Q. (Required) Newark Manufacturieg produces LCD touch skeen products. The cempuny reposts the following information at Doxenber 31. 2014; \begin{tabular}{|c|c|c|c|c|c|} \hline \multicolumn{2}{|c|}{ Materials inventory } & \multicolumn{2}{|c|}{ Work in process inventory } & \multicolumn{2}{|c|}{ Finishsd goods inventory } \\ \hline 47,000 & 31,460 & \begin{tabular}{l} 28,000 \\ 62,000 \\ 53,500 \end{tabular} & 123,000 & 123,000 & 109,900 \\ \hline \end{tabular} 1. What is the amsunt of cost of goods manufuctured foe the year? 2. What is the arnesunt of cont of geode sold bor the yau'? Ex 2-11 (1* edition Ex 2-11) Maven Cempany

Answer

The amount of cost of goods manufactured for the year is $176,960.

Solution

Calculation of total manufacturing costs: Total manufacturing costs include direct materials used, direct labor, and manufacturing overhead

Direct materials used: This is calculated by adding the beginning materials inventory to the purchases during the year and then subtracting the ending materials inventory. Since we do not have the purchases information, we assume it to be zero. Thus, Direct materials used = Beginning materials inventory + Purchases - Ending materials inventory =

47,000 +

0 -

31,460 =

15,540

Total manufacturing costs: Since we do not have separate figures for direct labor and manufacturing overhead, we assume that the work in process inventory change reflects these costs. Thus, Total manufacturing costs = Direct materials used + Change in work in process inventory =

15,540 + (

123,000 -

28,000) =

15,540 +

95,000 =

110,540

Cost of goods manufactured: This is calculated by adding the total manufacturing costs to the beginning work in process inventory and then subtracting the ending work in process inventory. Cost of goods manufactured = Total manufacturing costs + Beginning work in process inventory - Ending work in process inventory =

110,540 +

28,000 -

62,000 =

176,960

Key Concept

Cost of Goods Manufactured

Explanation

The cost of goods manufactured is the total cost incurred by a company to produce goods during a specific period. It includes direct materials, direct labor, and manufacturing overhead costs.

Answer

The amount of cost of goods sold for the year is $190,060.

Solution

Calculation of cost of goods sold: Cost of goods sold (COGS) is calculated by adding the beginning finished goods inventory to the cost of goods manufactured and then subtracting the ending finished goods inventory

COGS: COGS = Beginning finished goods inventory + Cost of goods manufactured - Ending finished goods inventory =

53,500 +

176,960 -

109,900 =

120,560 +

176,960 -

109,900 = $190,060

Key Concept

Cost of Goods Sold (COGS)

Explanation

The cost of goods sold is the cost attributed to the production of the products that were actually sold by the company. It is a key figure for understanding the company's gross profit.