Problem: Your schedule and statement must be in proper form - this means they should look like they would in an annual report - and not in a spread sheet or a work sheet. Individual overheads should be listed rather than just a total being given.
Greenville Products Inc. is a manufacturing firm. The company's inventory balances were as follows at the beginning and end of the year:
Beginning Balance Ending Balance
Raw Materials 21,000 24,000
Work in Progress 40,000 22,000
Finished Goods 26,000 41,000
The following transactions were recorded for the year:
- Raw materials were purchased, $300,000.
- Raw materials were requisitioned for use in production, $297,000 $(281,000 direct and $16,000 indirect).
- The following employee costs were incurred: direct labor, $399,000; indirect labor, $62,000; and administrative salaries, $176,000.
- Selling costs, $165,000.
- Factory utility costs, $19,000.
- Depreciation for the year was $143,000 of which $137,000 is related to factory operations and $6,000 is related to selling, general, and administrative activities.
- Sales for the year totaled $1,293,000.
Required:
Question 1: Prepare a schedule of cost of goods manufactured in good form.
Question 2: Prepare an income statement for the year in good form.