ACTG 2011 Lecture Notes - Inventory Control, Perpetual Inventory, Inventory Turnover

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silvermouse799

23 Feb 2011

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Document Summary

Inventory is assets held for sale or assets used to produce goods that will be sold as part of the business. Work-in-progress of wip inventory: partially completed product to date. Finished goods: inventory that has been completed and ready for sale. Requires inventory to be valued at costs on the balance sheet. Net realizable value (nrv) of inventory is less than costs, the inventory must be written down to its nrv. Costs of inventory includes all costs incurred to ready the inventory for sale or use: purchase price, import duties, and other taxes, shipping and handling, and any other costs directly related to the purchase of the inventory. Ifrs requires that the cost of inventory include the cost of materials, labor costs plus an allocation of overhead incurred in the production process. Overhead is the costs in manufacturing process other than direct labor and direct material.

Related Questions

Pirkl Corporation has providedthe following data for the month of March:

Inventories	Beginning		Ending
Raw materials	$	24,000	$	39,000
Work in process	$	13,000	$	20,000
Finished goods	$	46,000	$	35,000

Additional Information:


Raw materialspurchases	$	78,000
Direct laborcost	$	84,000
Manufacturingoverhead cost incurred	$	43,000
Indirect materialsincluded in manufacturing overhead cost incurred	$	6,400
Manufacturingoverhead cost applied to work in process	$	44,600

Required:
Prepare a Schedule ofCost of Goods Manufactured and a Schedule of Cost of Goods Sold.(Input all amounts as positive values. Omit the "$" sign inyour response.)

Schedule of Cost of Goods Manufactured
Directmaterials:
(Click to select)Beginning work inprocess inventoryBeginning finished goods inventoryEnding rawmaterials inventoryBeginning materials inventoryEnding work inprocess inventory	$
(Click to select)DeductAdd : (Clickto select)Ending work in process inventoryBeginning work in processinventoryFinished goods inventory, beginningPurchases of rawmaterialsRaw materials inventory, ending

Raw materials available for use
(Click to select)DeductAdd : (Clickto select)Ending work in process inventoryPurchases of rawmaterialsBeginning materials inventoryEnding raw materialsinventoryBeginning work in process inventory

Raw materials used in production
(Click to select)DeductAdd : (Clickto select)Beginning work in process inventoryindirect materialsincluded in manufacturing overhead incurredRaw materials inventory,endingEnding work in process inventoryRaw materials inventory,beginning
(Click toselect)Direct laborDirect materialsIndirect materialsIndirectlaborPurchase of raw materials		$
(Click to select)Rawmaterials inventory, endingEnding work in process inventoryRawmaterials inventory, beginningDirect laborPurchases of rawmaterials
(Click toselect)Manufacturing overhead applied to work in processinventoryBeginning work in process inventoryPurchases of rawmaterialsRaw materials inventory, beginningRaw materials inventory,ending

Total manufacturingcosts
(Click toselect)AddDeduct : (Click to select)Raw materials inventory,beginningRaw materials inventory, endingPurchases of rawmaterialsEnding work in process inventoryBeginning work in processinventory


(Click toselect)DeductAdd : (Click to select)Beginning work in processinventoryRaw materials inventory, beginningRaw materials inventory,endingPurchases of raw materialsEnding work in processinventory

Cost of goodsmanufactured		$

Schedule of Cost of Goods Sold
(Click toselect)Cost of goods manufacturedCost of goods available forsaleFinished goods inventory, endingOverapplied overheadFinishedgoods inventory, beginning	$
(Click toselect)DeductAdd : (Click to select)Unadjusted cost of goodssoldOverapplied overheadCost of goods manufacturedCost of goodsavailable for saleUnderapplied overhead

(Click toselect)Unadjusted cost of goods soldCost of goods available forsaleCost of goods manufacturedFinished goods inventory,beginningFinished goods inventory, ending
(Click toselect)AddDeduct : (Click to select)Overapplied overheadCost ofgoods manufacturedEnding finished goods inventoryUnderappliedoverheadCost of goods available for sale

(Click toselect)Finished goods inventory, beginningUnderappliedoverheadFinished goods inventory, endingUnadjusted cost of goodssoldCost of goods manufactured
(Click toselect)AddDeduct : (Click to select)Overapplied overheadCost ofgoods manufacturedUnderapplied overheadFinished goods inventory,endingCost of goods available for sale

Adjusted cost ofgoods sold	$

sangriaporpoise205

The Zoe Corporation has thefollowing information for the month of March. Prepare a schedule ofcost of goods manufactured.

Purchases	$92,000
Materials inventory, March 1	6,000
Materials inventory, March 31	8,000
Direct labor	25,000
Factory overhead	37,000
Work in process, March 1	22,000
Work in process, March 31	18,500
Finished goods inventory, March 1	21,000
Finished goods inventory, March 31	25,000
Sales	257,000
Sales and administrative expenses	79,000

ANS:

Zoe Corporation
Statement of Cost of Goods Manufactured Answer all in bold

Work in process inventory March 1
Direct Materials:
Materials inventory, March 1
Purchases
Cost of materials for use
Less materials inventory, March 31
Cost of materials placed inproduction
Direct Labor
Factory overhead
Total manufacturing costs added
Total manufacturing costs
Less work in process inventory, March 31
Cost of goods manufactured

coralgoldfish925

winter's , manufacturer of winter coats, current year'spredetermined overhead rate is 75% of direct labor cost.

Prepare the ending inventory value that would be presented onthe balance sheet and winter's income statement.

requires : write down the detailed calculation process ( how doyou gets those number)

beginning materials inventory 35,000

beginning work in process 20,000

beginning finished goods inventory 15,000

materials purchased 30,000

direct materials requested ?

direct labor cost incurred 30,000

direct labor paid 28,000

overhead applied ?

costs of units completed 50,000

costs of goods sold ?

ending materials inventory 15,000

ending working in process ?

ending finished goods 33,000

sales 60,000

administrative expense 15,000

lavendersea-lion29

ACTG 2011 Lecture Notes - Inventory Control, Perpetual Inventory, Inventory Turnover

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