Part 5 -Problem: (15 points) James Corporation incurred the following costs whil
ID: 2570620 • Letter: P
Question
Part 5 -Problem: (15 points) James Corporation incurred the following costs while manufacturing its prod uct. Materials used in product $135,000 Depreciation on plant Property taxes on store 7,500 Labor costs of assembly-line workers 110,000 Factory supplies used 25,000 Advertising expense $45,000 Property taxes on plant 19,000 60,000 Delivery expense 21,000 Sales commissions 35,000 Salaries paid to sales clerks 50,000 Work-in-proces s inventory was $17,500 at January 1 and $14,000 at December 31. Finished goods inventory was $60,500 at January 1 and $42,000 at December 31 . Instructions (a) Compute cost of goods manufactured. (b) Compute cost of goods sold.Explanation / Answer
Cost of goods manufactured Material Used in Product 135000 Labor costs of assembly-line workers 110000 Factory overheads Depreciation on plant 60000 Property taxes on plant 7500 Factory supplies used 25000 Total Overhead 92500 Add WIP 17500 Less: WIP 14000 Cost of goods manufactured 96000 Cost of goods sold Beginning Finished Goods 60500 Cost of goods Manufactured 96000 Less Ending Finished Goods 42000 Cost of goods Sold 114500