Question

As in the previous Participation Exercise, the Khalid Company manufactures and sells Paso-the-Salsa, which is a bottled condiment used on a variety of foods. Each bottle is sold for $5. The company recently had the following costs to produce 12,000 units of its product during August:_______.
A. Rent of $5,000 on a billboard to help advertise the product
B. Rent on factory and equipment of $8,000
C. Total payroll for hourly paid, factory workers $24,000
D. Tomatoes, onions, spices and bottles $18,000
E. Total payroll for salaried, administrative staff $6,000

Answer 1

Answer:

Questions

What is the company's cost of goods sold for the month?

COGS 33,000

What is the company's net income for the month?

net loss               4,333

What is the company's ending inventory for the month?

16,667

Missing Information:

It sold 8,00 units

Explanation:

manufacturing cost:

rent on factory 8000 +

factory workers salary 24000 +

direct materials  18000 = 50,000

cost per unit considering it produced 12,000:

50,000 / 12,000 = (4 + 1/6)

then, cost of good sold: cost per unit x units sold

(4 + 1/6) x 8,000 = 33,333.33

ending inventory 50,000  manufactured - 33,333 sold = 16,667 ending inventory

income for the month:

8,000 x 5         40,000

COGS              - 33,333  

gross margin       6,667

adv expense     -5,000

admin expense -6,000    

net loss               4,333