Problem 143A Schedule of cost of goods manufactured and inco

Problem 14-3A Schedule of cost of goods manufactured and income statement; inventory analysis LO P2, A1 The following Information applies to the questions displayed below The following calendar year-end information is taken from the December 31, 2015, adjusted trial balance and other records of Leone Company. $ 33,700 Advertising expense Depreclation expense-Office equipment Depreciation expense-Selling equipment Depreciation expense-Factory equipment Factory supervision Factory supplies used Factory utlities Inventories Direct Inbor Income taxes expense 698,900 273,800 59,400 0,500 60,000 957000 28,000 25,200 79,000 35,500 4,536,000 8,600 0,700 8,100 Indirect labor Miscellaneous production costs Office salaries expense 144,300 9,600 Raw materials purchases 45,000 Rent expense-Office space Rent expense-Selling space Raw materlals, December 31,2014 Raw materials, December 31, 2015 Work in process, December 31, 2014 Work in process, December 31, 2015 Finished goods, December 31, 2014 Finished goods, December 31, 2015 64,200 Rent expense-Factory building 175.000 Maintenance expense-Factory equipment 15,400 Sales 20,100 Sales salaries expense 60,600 42,600 391,600

Solution

Answer:

1

LE LEON COMPANY

Manufacturing Statement

For Year Ended December 31, 2015

Direct materials

Raw materials inventory, December 31, 2014

$164,200

Raw materials purchases

957,000

Raw materials available for use

1,121,200

Less: Raw materials inventory, December 31, 2015

175,000

Direct materials used

$946,200

Direct labor

698,900

Factory overhead

Factory supervision

144,300

Factory supplies used

9,600

Factory utilities

45,000

Maintenance expense—Factory equipment

35,500

Rent expense—Factory building

79,000

Depreciation expense—Factory equipment

38,100

Indirect labor

59,400

Miscellaneous production costs

10,500

Total factory overhead costs

421,400

Total manufacturing costs

2,066,500

Add: Goods in process inventory, December 31, 2014

15,400

Total cost of goods in process

2,081,900

Less: Goods in process inventory, December 31, 2015

20,100

Cost of goods manufactured

$2,061,800

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2

LE LEON COMPANY

Income Statement

For Year Ended December 31, 2015

Sales

$4,536,000

Cost of goods sold

Cost of goods manufactured

$2,061,800

Finished goods inventory, December 31, 2014

160,600

Goods available for sale

2,222,400

Less: Finished goods inventory, December 31, 2015

142,600

Cost of goods sold

2,079,800

Gross profit from sales

2,456,200

Operating expenses

Selling expenses

Depreciation expense—Selling equipment

10,700

Rent expense—Selling space

25,200

Sales salaries expense

391,600

Advertising expense

33,700

Total selling expenses

461,200

General and administrative expenses

Rent expense—Office space

28,000

Office salaries expense

60,000

Depreciation expense—Office equipment

8,600

Total general and administrative expenses

96,600

Total operating expenses

557,800

Income before state and federal taxes

1,898,400

Income taxes expense

273,800

Net income

$1,624,600

LE LEON COMPANY
Manufacturing Statement
For Year Ended December 31, 2015
Direct materials
Raw materials inventory, December 31, 2014	$164,200
Raw materials purchases	957,000
Raw materials available for use	1,121,200
Less: Raw materials inventory, December 31, 2015	175,000
Direct materials used		$946,200
Direct labor		698,900
Factory overhead
Factory supervision	144,300
Factory supplies used	9,600
Factory utilities	45,000
Maintenance expense—Factory equipment	35,500
Rent expense—Factory building	79,000
Depreciation expense—Factory equipment	38,100
Indirect labor	59,400
Miscellaneous production costs	10,500
Total factory overhead costs		421,400
Total manufacturing costs		2,066,500
Add: Goods in process inventory, December 31, 2014		15,400
Total cost of goods in process		2,081,900
Less: Goods in process inventory, December 31, 2015		20,100
Cost of goods manufactured		$2,061,800