Exercise 209 At May 31 2017 the accounts of Lopez Company sh

Exercise 20-9 At May 31, 2017, the accounts of Lopez Company show the following. 1. May 1 inventories-finished goods $14,300, work in process $17,400, and raw materials $8,800 2. May 31 inventories-finished goods $9,900, work in process $16,000, and raw materials $7,500. 3. Debit postings to work in process were direct materials $64,700, direct labor $50,400, and manufacturing overhead applied $42,500. 4. Sales revenue totaled $216,000.

Solution

LOPEZ COMPANY Cost of Goods Manufactured Schedule Particulars Amount Work in process, May 1 17400 Direct materials used 64700 Direct labor 50400 Manufacturing overhead applied 42500 Total manufacturing costs 157600 Total cost of work in process 175000 Less: Work in process, May 31 16000 Cost of goods manufactured 159000 LOPEZ COMPANY (Partial) Income Statement Particulars Amount Sales 216000 Less: Cost of goods sold: Finished goods, May 1 14300 Cost of goods manufactured 159000 Cost of goods available for sale 173300 Less: Finished goods, May 31 9900 Cost of goods sold 163400 Gross profit 52600 LOPEZ COMPANY (Partial) Balance sheet ASSETS AMOUNT Current Assets: Raw material inventory 7500 Work in process inventory 16000 Finished goods inventory 9900 Total 33400