Excercise 1

1) South State Company used $71,000 of direct materials and incurred $37,000 of direct labor costs during 2012. Indirect labor amounted to $2,700 while indirect materials used totaled $1,600. Other operating costs pertaining to the factory included utilities of $3,100; maintenance of $4,500; repairs of $1,800; depreciation of $7,900; and property taxes of $2,600. There was no beginning or ending finished goods inventory, but work in process inventory began the year with a $5,500 balance and ended the year with a $7,500 balance.

Required: Prepare a schedule of cost of goods manufactured for South State Company using the format below.

COST OF GOODS MFGD

Beginning work in process

Direct materials used:

Direct labor

Manufacturing overhead:

Indirect labor

Indirect materials

Utilities

Maintenance

Repairs

Depreciation

Property taxes

Total manufacturing overhead

Total mfg costs incurred

Total mfg costs to account for

Ending work in process

Cost of goods manufactured

2) Arturo Manufacturing Company provided the following information for the year 2012:

Purchases—direct materials $180,000

Direct materials used in production $192,000

Direct labor $235,000

Indirect materials $23,500

Indirect labor $9,500

Depreciation on factory plant & equipment $12,000

Plant utilities & insurance $135,000

Cost of goods manufactured $591,000

Cost of goods sold $598,500

Please refer to the T-accounts below which show the beginning balances for the year. Record the transactions for the year in each of the three inventory accounts and then show the ending balance in each T-account.

3) Best Company sells office supplies. The following information summarizes Best's operating activities for 2012:

Utilities for store $6,000

Rent for store $8,000

Sales commissions $4,500

Purchases of merchandise $54,000

Inventory on January 1, 2012 $30,000...