Answer:
Cost of Goods Available Sold $ 265,000
Adjusted Cost of Goods Sold $ 255,000
<u>Net Income $ 66,000 </u>
Explanation:
<u><em> Mason Company: </em></u>
<u><em>Cost Of Goods Schedule</em></u>
Inventories Beginning Raw materials $ 7,000
Raw material purchases $ 118,000
Inventories Ending Raw materials $ 15,000
Direct Materials Used $ 110,000
Direct labor cost $ 70,000
Manufacturing overhead applied to work in process $ 90,000
Total Manufacturing Costs $ 270,000
Add Work in process Inventories Beginning $ 10,000
Cost of Goods Available For Manufacture $ 280,000
Less Work in process Inventories Ending $ 5,000
Cost of Goods Manufactured $ 275,000
Add Finished goods Inventories Beginning $ 20,000
Cost of Goods Available For Sale $ 295,000
Less Finished goods Inventories Ending $ 35,000
Cost of Goods Available Sold $ 265,000
<u>Mason Company: </u>
<u>Cost Of Goods Schedule Adjusted </u>
Inventories Beginning Raw materials $ 7,000
Raw material purchases $ 118,000
Inventories Ending Raw materials $ 15,000
Direct Materials Used $ 110,000
Direct labor cost $ 70,000
Manufacturing overhead applied to work in process $ 90,000
Total Manufacturing Costs $ 270,000
Add Work in process Inventories Beginning $ 10,000
Cost of Goods Available For Manufacture $ 280,000
Less Work in process Inventories Ending $ 5,000
Cost of Goods Manufactured $ 275,000
Add Finished goods Inventories Beginning $ 20,000
Cost of Goods Available For Sale $ 295,000
Less Finished goods Inventories Ending $ 35,000
Cost of Goods Available Sold $ 265,000
Less Over Applied Overhead $ 10,000
Adjusted Cost of Goods Sold $ 255,000
Over applied overhead is deducted to get the actual Cost of Goods Sold.
<em><u>Mason Company: </u></em>
<em><u>Income Statement</u></em>
Sales $ 524,000
Less
Adjusted Cost of Goods Sold $ 255,000
Gross Profit $ 269,000
Less Selling expenses $ 140,000
Administrative expenses $ 63,000
<u>Net Income $ 66,000 </u>
