Create a cost of goods sold budget


Response to the following problem:

Dover Chemical Company uses oil to produce two types of plastic products, P1 and P2. Dover budgeted 30,000 barrels of oil for purchase in June for $28 per barrel. Direct labor budgeted in the chemical process was $150,000 for June. Factory overhead was budgeted $275,000 during June. The inventories on June 1 were estimated to be:

Oil . . . . . . . . . . . . . . . . . . . . . . . . $15,300

P1 . . . . . . . . . . . . . . . . . . . . . . . . . . 8,700

P2 . . . . . . . . . . . . . . . . . . . . . . . . . . 9,200

Work in process . . . . . . . . . . . . . . 11,800

The desired inventories on June 30 were:

Oil . . . . . . . . . . . . . . . . . . . . . . . . $12,200

P1 . . . . . . . . . . . . . . . . . . . . . . . . . . 8,300

P2 . . . . . . . . . . . . . . . . . . . . . . . . . . 9,500

Work in process . . . . . . . . . . . . . . 10,700

Use the preceding information to prepare a cost of goods sold budget for June.

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Cost Accounting: Create a cost of goods sold budget
Reference No:- TGS02069979

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