Superior Company provided the following data for the year endedDecember 31 (all raw materials are used in production as directmaterials):
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| Selling expenses | $ | 213,000 |
| Purchases of raw materials | $ | 260,000 |
| Direct labor | | ? |
| Administrative expenses | $ | 152,000 |
| Manufacturing overhead applied to work in process | $ | 375,000 |
| Actual manufacturing overhead cost | $ | 357,000 |
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Inventory balances at the beginning and end of the year were asfollows:
| Beginning of Year | End of Year |
| Raw materials | $ | 53,000 | | $ | 36,000 | |
| Work in process | | ? | | $ | 29,000 | |
| Finished goods | $ | 36,000 | | | ? | |
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The total manufacturing costs for the year were $680,000; thecost of goods available for sale totaled $740,000; the unadjustedcost of goods sold totaled $661,000; and the net operating incomewas $32,000. The company’s underapplied or overapplied overhead isclosed to Cost of Goods Sold.
Required:
Prepare schedules of cost of goods manufactured and cost ofgoods sold and an income statement. (Hint: Prepare theincome statement and schedule of cost of goods sold first followedby the schedule of cost of goods manufactured.)
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| | Superior Company | | Schedule of Cost GoodsManufactured | | Direct materials: | | | | | | | | | | Total raw materials available | | | | | | | Raw materials used in production | | | | | | | | | | Total manufacturing costs | | | | | | | | | | | | | Cost of goodsmanufactured | | |
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Schedule of COGS
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| Adjusted Cost of Goods sold | |
Income Statement
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| Selling and administrative expenses: | | |
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