exercise: Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials):Selling expenses$ 140,000Purchases of raw materials$ 290,000Direct labor?Administrative expenses$ 100,000Manufacturing overhead applied to work in process$ 285,000Actual manufacturing overhead cost$ 270,000Beginning and ending inventory balances were as follows: BeginningEndingRaw materials$ 40,000$ 10,000Work in process?$ 35,000Finished goods$ 50,000?The total manufacturing costs added to production for the year were $683,000; the cost of goods available for sale totaled $740,000; the unadjusted cost of goods sold totaled $660,000; and the net operating income was $30,000. The company’s underapplied or overapplied overhead is closed to Cost of Goods Sold.Required:Prepare schedules of cost of goods manufactured and cost of goods sold and an income statement. (Hint: Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.)

In this exercise, we are tasked with preparing a comprehensive financial report for Superior…

Answered: exercise: Superior Company provided the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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exercise: Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials):

Selling expenses	$ 140,000
Purchases of raw materials	$ 290,000
Direct labor	?
Administrative expenses	$ 100,000
Manufacturing overhead applied to work in process	$ 285,000
Actual manufacturing overhead cost	$ 270,000

Beginning and ending inventory balances were as follows:

	Beginning	Ending
Raw materials	$ 40,000	$ 10,000
Work in process	?	$ 35,000
Finished goods	$ 50,000	?

The total manufacturing costs added to production for the year were $683,000; the cost of goods available for sale totaled $740,000; the unadjusted cost of goods sold totaled $660,000; and the net operating income was $30,000. The company’s underapplied or overapplied overhead is closed to Cost of Goods Sold.

Required:

Prepare schedules of cost of goods manufactured and cost of goods sold and an income statement. (Hint: Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.)

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