(Solved) Farley Muffler Inc. received the following monthly report from its newly hired accountant, who quit ...

Farley Muffler Inc. received the following monthly report from its newly hired accountant, who quit after only a week on the job.

   Farley Muffler Inc.
   Cost of Goods Sold Schedule

Finished Goods Inventory (beginning)         $15,000
Work-in-Process Inventory (beginning)           3,000
Total         $18,000

Current Manufacturing Costs:
Salaries and wages:
   Direct manufacturing labour   $5,000
   Indirect manufacturing labour   2,000
   Sales salaries   4,000
   Administrative    3,000   $14,000

Other:
   Manufacturing supplies   $1,500
   Manufacturing amortization   3,500
   Insurance on showroom   1,000
   Miscellaneous factory overhead     6,500   12,500     26,500
Total Work in Process         $44,500
Ending Work-in-Process and Finished Goods Inventory        0
Cost of Goods Sold         $44,500

   Farley Muffler, Inc.
   Income Statement
Sales         $100,000
Less direct materials           20,000
Gross profit         $80,000

Less other expenses:
   Cost of goods sold      $44,500
   Office supplies      250
   Manufacturing utilities      1,000
   Office utilities        250     46,000
Net Income         $34,000

Required:
a.   Prepare a cost of goods manufactured schedule.
b.   Prepare an income statement in good form.

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Farley Muffler Inc. received the following monthly report from its newly hired accountant, who quit ...

Cost Accounting: A Managerial Emphasis, Canadian Edition

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