HORNGREN/DATAR/FOSTER, COST ACCOUNTING 11E

Problem 2-28 Name Answer Key

Section

A B C D E F G H
5 Part 1. Canseco Company
6 Cost of Goods Manufactured
7 For the Year Ended December 31, 2004
8 Direct materials cost:
9 Beginning inventory, January 1 $ 22,000
10 Purchase of direct materials 75,000
11 Cost of direct materials available for use 97,000
12 Ending inventory, December 31 26,000
13 Direct materials used $ 71,000
14 Direct manufacturing labor costs 25,000
15 Manufacturing overhead costs:
16 Indirect manufacturing labor costs $ 15,000
17 Plant insurance 9,000
18 Depreciation - plant building and equipment 11,000
19 Repairs and maintenance - plant 4,000 39,000
20 Manufacturing costs incurred during 2004 135,000
21 Add beginning work-in-process inventory, January 1 21,000
22 Total manufacturing costs to account for 156,000
23 Deduct ending work-in-process inventory, December 31 20,000
24 Cost of goods manufactured $ 136,000
25
26 Part 2. Canseco Company
27 Income Statement
28 For the Year Ended December 31, 2004
29
30 Sales $ 300,000
31 Cost of gods sold:
32 Beginning finished goods, January 1 $ 18,000
33 Cost of good manufactured 136,000
34 Cost of goods available for sale 154,000
35 Ending finished goods, December 31 23,000
36 Cost of goods sold 131,000
37 Gross margin 169,000
38 Operating costs:
39 Marketing, distribution, and customer service 93,000
40 General and administrative 29,000
41 Operating costs 122,000
42 Operating income $ 47,000
43
44
End of Problem