Chapter 2 Problem Solutions
Transcript of Chapter 2 Problem Solutions
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2-47(30 min.) Prepare Statements for a Manufacturing Company: Pioneer Parts
Pioneer PartsStatement of Cost of Goods SoldFor the Year Ended December 31
($000)Work in process, Jan. 1 $ 24Manufacturing costs: Direct materials: Beginning inventory, Jan. 1 $ 18 Add material purchases 1,640 Direct materials available 1,658 Less ending inventory, Dec. 31 16 Direct materials used $ 1,642 Direct labor 2,120 Manufacturing overhead: Indirect factory labor 560 Indirect materials and supplies 140 Factory supervision 420 Factory utilities 180 Factory and machine depreciation 2,320 Property taxes on factory 56 Total manufacturing overhead 3,676 Total manufacturing costs 7,438Total cost of work in process during the year 7,462 Less work in process, Dec. 31 28 Costs of goods manufactured during the year 7,434Beginning finished goods, Jan. 1 328Finished goods inventory available for sale 7,762Less ending finished goods inventory, Dec. 31 294Cost of goods sold $7,468
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2-47. (continued)
Pioneer PartsIncome Statement
For the Year Ended December 31($000)
Sales revenue $9,080Less: Cost of goods sold 7,468Gross margin 1,612Administrative costs $720Marketing costs 300Total marketing and administrative costs 1,020Operating profit $ 592
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2-48 (30 min.) Prepare Statements for a Manufacturing Company: Oakdale Tool & Die
.
Oakdale Tool & DieStatement of Cost of Goods SoldFor the Year Ended December 31
($ 000)Beginning work in process, Jan. 1 $ 96Manufacturing costs: Direct materials: Beginning inventory, Jan. 1 $ 36 Add: Purchases 10,950 Direct materials available 10,986 Less ending inventory, Dec. 31 42 Direct materials used $10,944 Direct labor 2,520 Manufacturing overhead: Indirect factory labor 2,736 Factory supervision 1,470 Indirect materials and supplies 2,055 Building utilities (90% of total) 3,375 Building & machine depreciation (75% of $2,700) 2,025 Property taxes—factory (80% of total) 2,016 Total manufacturing overhead 13,677 Total manufacturing costs 27,141Total cost of work in process during the year 27,237 Less work in process, Dec. 31 87 Costs of goods manufactured during the year 27,150Beginning finished goods, Jan. 1 162Finished goods available for sale 27,312Less ending finished goods, Dec. 31 195Cost of goods sold $ 27,117
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2-48. (continued)
Oakdale Tool & DieIncome Statement
For the Year Ended December 31($ 000)
Sales revenue $38,910Less: Cost of goods sold (per statement) 27,117Gross profit $ 11,793Marketing and administrative costs: Depreciation (25% of total) $ 675 Utilities (10% of total) 375 Property taxes (20% of total) 504 Administrative costs 4,800 Marketing costs 2,613 Total marketing and administrative costs 8,967Operating profit $ 2,826
2-1.
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2-53 (40 Min.) Find the Unknown Information.
a. Cost of goods sold
=Finished goods
beginning inventory+
Cost of goods manufactured
–Finished goods ending inventory
= $22,320 + $598,400 – $25,520Cost of
goods sold= $595,200
b. Total manufacturing
costs=
Direct materials
used+
Direct labor
+Manufacturing
overhead
$612,320 =Direct
materials used
+ $270,400 + $225,000
Direct materials used
= $116,920 (= $612,320 – $270,400 – $225,000)
c. Direct materials
used=
Beginning inventory
+Materials
purchased–
Ending inventory
$116,920 = $2,520 +Materials
purchased– $2,088
Materials purchased
= $116,488 (= 116,920 – $2,520 + $2,088)
d. Gross margin % = Gross margin ÷ Sales revenue
38%= (Sales revenue –
Cost of goods sold)÷ Sales revenue
38% x Sales revenue = Sales revenue – Cost of goods soldCost of goods sold = Sales revenue – (38% x Sales revenue)Cost of goods sold = Sales revenue x (1 – 38%)
Sales revenue = Cost of goods sold ÷ (100% – 38%)= $595,200 (from a) ÷ 62%
$960,000