Answer and Explanation:
The computation is shown below:
Ending balance of raw material inventory = Beginning inventory + Raw Material purchased - Raw materiel consumed
= $55,000 + $238,900 - $249,400
= $44,500
Ending balance of WIP = Beginning WIP + Direct material consumed + Direct labor + Manufacturing overhead applied - Cost of goods produced
= $82,800 + $238,900 + $322,700 + $46,100 - $611,600
= $78,900
Ending inventory of finished goods = Beginning inventory + Cost of goods produced - Cost of goods sold
= $27,800 + $611,600 - $600,400
= $39,000
Now the preparation is presented below:
Schedule of cost of goods manufactured
Direct Material:
Beginning balance of raw material $55,000
Add: Purchase of raw material $238,900
Less: Ending raw material balance -$44,500
Raw material used in production $249,400 (A)
Add: Direct labor $322,700 (B)
Add: Manufacturing overhead $46,100 (C)
Total manufacturing cost $618,200 (A + B + C)
Add: Beginning balance of work in process $82,800
Less: Ending balance of work in process -$78,900
Cost of goods manufactured $622,100
Add: Beginning finished goods inventory $27,800
Finished goods available for sale $649,900
Less: Ending finished goods inventory -$39,000
Cost of goods sold $610,900
Income statement
Sales revenue $801,400
Less: Cost of goods sold -$610,900
Gross Margin
$190,500
Less: Selling and admin expense -$70,100
Net Operating income $120,400
