SHOW WORK PLEASE Road Warrior Corporation began operations early in the current

Question

SHOW WORK PLEASE

Road Warrior Corporation began operations early in the current year, building luxury motor homes. During the year, the company started and completed 50 motor homes at a cost of $60,000 per unit. Of these, 48 were sold for $110,000 each and two remain in finished goods inventory. In addition, the company had six partially completed units in its factory at year-end. Total costs for the year (summarized alphabetically) were as follows:

Compute the total manufacturing costs charged to work in process for the current year:

Compute the cost of finished goods manufactured for the current year:

Compute the cost of goods sold for the current year:

Compute the gross profit on sales for the current year:

Compute the ending inventories of (1) work in process and (2) finished goods for the current year:

SHOW WORK PLEASE

Road Warrior Corporation began operations early in the current year, building luxury motor homes. During the year, the company started and completed 50 motor homes at a cost of $60,000 per unit. Of these, 48 were sold for $110,000 each and two remain in finished goods inventory. In addition, the company had six partially completed units in its factory at year-end. Total costs for the year (summarized alphabetically) were as follows:

Explanation / Answer

(a) Direct material 795,000.00 Direct Labour 969,000.00 Manufacturing overhead 1,640,000.00 Total manufacturing cost ,a 3,404,000.00 Total cost incurred for finished goods = 50*60,000 b 3,000,000 There cost of production incurred for Work in process c = a-b 404,000.00 Therefore total manufacturing cost charged to work in process = $404,000 (b) Cost of finished goods manufactured = 50 * 60,000 3,000,000 ( c) Cost of goods sold for the current year Manufacturing cost 2,880,000 Add: General and administrative expense (500000/50*48) 480,000 Add: Selling expenses 500,000 Cost of goods sold 3,860,000 (d) Total Sales ( 110000*48) 52,800,000 less: Cost of goods sold 3,860,000 Gross profit 1420,000 Less: Income tax 100,000 Net profit 1320,000

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