Using the Internet locate the most recent financial report o

Using the Internet, locate the most recent financial report of a company of your choosing. The company you select to research must be in the business of manufacturing a product. If the required information is not available, then you will need to select a different company. Write an initial post by responding to the following: Do not research the company listed in the text. What categories of inventory does the company show in its inventories footnote under “Notes to Consolidated Financial Statements”? Using the income statement and inventory information from the footnote, calculate the cost of finished goods manufactured for the most recent year. What elements of manufacturing overhead can you identify using the annual report?

Solution

The answer is based on the financial report of Frigoglass S.A.I.C which is involved in manufacture of visicoolers for the year ended 31.12.2016.

The categories of inventory that the company show in its footnote under \"Notes to Consolidated Financial Statement are:-

Raw Material

Work in progress

Finished goods

The cost of finished goods manufactured and sold is Euro

Cost of goods sold= Opening finished goods inventory + cost of goods manufactured - Closing finished goods inventory

Working Note:-

Cost of goods manufactured= Cost of goods sold - Opening finished goods inventory
+ Closing finished goods inventory

Cost of goods manufactured= Euro 351.764 - Euro 50.657 + Euro 46.841

                                             =Euro 347.948

Elements of manufacturing overheads:-

Raw Material, consumables, energy and maintenance

Wages & Salaries

Transportation expenses

Rent, Insurance, Leasing payments and security expenses

Depreciation allocated to Cost of goods sold

Link to financial results for the year emded 31 Dec 2016- https://www.frigoglass.com/financial-results/

(Go on the above link and download the financial statements December 2016)