Question

The following information is available for Robstown Corporation for 20Y8: Inventories January 1 December 31 Materials $351,000 $435,800 Work in process 625,200 590,400 Finished goods 607,400 571,000 December 31 Advertising expense $ 296,600 Depreciation expense-office equipment 43,560 Depreciation expense-factory equipment 55,880 Direct labor 669,000 Heat, light, and power-factory 22,060 Indirect labor 76,000 Materials purchased 658,200 Office salaries expense 183,300 Property taxes-factory 18,300 Property taxes-office building 31,200 Rent expense-factory 32,500 Sales 3,011,000 Sales salaries expense 417,000 Supplies-factory 16,000 Miscellaneous costs-factory 9,200 Required: a. Prepare the 20Y8 statement of cost of goods manufactured. For those boxes in which you must enter subtracted or negative numbers use a minus sign\.\* b. Prepare the 20Y8 income statement. *Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.

Answer 1

Answer:

                            Robstown Corporation

                Statement of Cost of Goods Manufactured

                  For the Year Ended December 31, 20Y8

Work in process inventory, January 1, 20Y8                               $625,200

Direct materials:    

Materials inventory, January 1, 20Y8    $351,000  

Purchases                                                $658,200

Cost of materials available for use     $1,009,200

Materials inventory, Dec 31, 20Y8        ($435,800)  

Cost of direct materials used in              $573,400   $573,400

production  

Direct labor                                                                  $669,000  

Factory overhead

Depreciation expense-factory                 $55,880

equipment  

Heat, light, and power-factory                 $22,060  

Indirect labor                                             $76,000  

Miscellaneous costs-factory                    $9,200

Property taxes-factory                              $18,300

Rent expense-factory                               $32,500  

Supplies-factory                                        $16,000  

Total factory overhead                                                $229,940

Total manufacturing costs                                                             $1,472,340

incurred in 20Y8

Total manufacturing costs                                                            $2,097,540

Work in process inventory, December 31, 20Y8                         ($590,400)

Cost of goods manufactured                                                       $1,507,140

                                      Robstown Corporation

                                         Income Statement

                         For the Year Ended December 31, 20Y8

Sales                                                                                           $3,011,000

Cost of goods sold:

Finished goods inventory, Jan 1, 20Y8              $607,400  

Cost of goods manufactured                              $1,507,140  

Cost of finished goods available for sale        $2,114,540

Finished goods inventory, Dec. 31, 20Y8          ($571,000)  

Cost of Goods Sold                                                                      $1,543,540

Gross Profits                                                                                 $1,467,460

Operating expenses:

Administrative expenses:

Depreciation expense-office equipment     $43,560  

Office salaries expense                                 $183,300  

Property taxes-office building                       $31,200   $258,060

Selling expenses:

Sales salaries expense                                  $417,000  

Advertising expense                                     $296,600 $713,600

Total operating expenses                                                                $971,660

Net income                                                                                        $495,800