chapter 16 introduction to managerial accounting demonstration problems © 2016 pearson education,...
TRANSCRIPT
Chapter 16
Introduction to Managerial Accounting
Demonstration Problems
© 2016 Pearson Education, Ltd. 16-1
Demonstration of E16-23
Inventories: Beginning Ending
Raw Materials $16,000
$12,000
Work-in-Process98,000 87,000
Finished Goods20,000 25,000
Other information:
Purchases of materials $37,000
Direct labor76,000
Manufacturing overhead34,000
Use the following information for a manufacturer to compute cost of goods manufactured and cost of goods sold:
Beginning Work-in-Process Inventory $ 98,000
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Work-in-Process Inventory $ 98,000
Direct Materials Used:
Beginning Raw Materials Inventory $ 16,000
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Work-in-Process Inventory $ 98,000
Direct Materials Used:
Beginning Raw Materials Inventory $ 16,000
Purchases of Raw Materials 37,000
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Work-in-Process Inventory $ 98,000
Direct Materials Used:
Beginning Raw Materials Inventory $ 16,000
Purchases of Raw Materials 37,000
Raw Materials Available for Use 53,000
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Work-in-Process Inventory $ 98,000
Direct Materials Used:
Beginning Raw Materials Inventory $ 16,000
Purchases of Raw Materials 37,000
Raw Materials Available for Use 53,000
Ending Raw Materials Inventory (12,000)
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Work-in-Process Inventory $ 98,000
Direct Materials Used:
Beginning Raw Materials Inventory $ 16,000
Purchases of Raw Materials 37,000
Raw Materials Available for Use 53,000
Ending Raw Materials Inventory (12,000)
Direct Materials Used 41,000
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Work-in-Process Inventory $ 98,000
Direct Materials Used:
Beginning Raw Materials Inventory $ 16,000
Purchases of Raw Materials 37,000
Raw Materials Available for Use 53,000
Ending Raw Materials Inventory (12,000)
Direct Materials Used 41,000
Direct Labor 76,000
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Work-in-Process Inventory $ 98,000
Direct Materials Used:
Beginning Raw Materials Inventory $ 16,000
Purchases of Raw Materials 37,000
Raw Materials Available for Use 53,000
Ending Raw Materials Inventory (12,000)
Direct Materials Used 41,000
Direct Labor 76,000
Manufacturing Overhead 34,000
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Work-in-Process Inventory $ 98,000
Direct Materials Used:
Beginning Raw Materials Inventory $ 16,000
Purchases of Raw Materials 37,000
Raw Materials Available for Use 53,000
Ending Raw Materials Inventory (12,000)
Direct Materials Used 41,000
Direct Labor 76,000
Manufacturing Overhead 34,000
Total Manufacturing Costs Incurred During the Year 151,000
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Work-in-Process Inventory $ 98,000
Direct Materials Used:
Beginning Raw Materials Inventory $ 16,000
Purchases of Raw Materials 37,000
Raw Materials Available for Use 53,000
Ending Raw Materials Inventory (12,000)
Direct Materials Used 41,000
Direct Labor 76,000
Manufacturing Overhead 34,000
Total Manufacturing Costs Incurred During the Year 151,000
Total Manufacturing Costs to Account For 249,000
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Work-in-Process Inventory $ 98,000
Direct Materials Used:
Beginning Raw Materials Inventory $ 16,000
Purchases of Raw Materials 37,000
Raw Materials Available for Use 53,000
Ending Raw Materials Inventory (12,000)
Direct Materials Used 41,000
Direct Labor 76,000
Manufacturing Overhead 34,000
Total Manufacturing Costs Incurred During the Year 151,000
Total Manufacturing Costs to Account For 249,000
Ending Work-in-Process Inventory (87,000)
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Work-in-Process Inventory $ 98,000
Direct Materials Used:
Beginning Raw Materials Inventory $ 16,000
Purchases of Raw Materials 37,000
Raw Materials Available for Use 53,000
Ending Raw Materials Inventory (12,000)
Direct Materials Used 41,000
Direct Labor 76,000
Manufacturing Overhead 34,000
Total Manufacturing Costs Incurred During the Year 151,000
Total Manufacturing Costs to Account For 249,000
Ending Work-in-Process Inventory (87,000)
Cost of Goods Manufactured $ 162,000
Calculation of cost of goods manufactured
Demonstration of E16-23
Beginning Finished Goods Inventory $ 20,000
Calculation of cost of goods sold
Demonstration of E16-23
Beginning Finished Goods Inventory $ 20,000
Cost of Goods Manufactured 162,000 [previous slide]
Calculation of cost of goods sold
Demonstration of E16-23
Beginning Finished Goods Inventory $ 20,000
Cost of Goods Manufactured 162,000 [previous slide]
Cost of Goods Available for Sale 182,000
Calculation of cost of goods sold
Demonstration of E16-23
Beginning Finished Goods Inventory $ 20,000
Cost of Goods Manufactured 162,000 [previous slide]
Cost of Goods Available for Sale 182,000
Ending Finished Goods Inventory (25,000)
Calculation of cost of goods sold
Demonstration of E16-23
Beginning Finished Goods Inventory $ 20,000
Cost of Goods Manufactured 162,000 [previous slide]
Cost of Goods Available for Sale 182,000
Ending Finished Goods Inventory (25,000)
Cost of Goods Sold $157,000
Calculation of cost of goods sold
Demonstration of E16-23
Demonstration of E16-25
Selling and Administrative Expenses $147,000
Purchases208,000
Sales Revenue421,000
Merchandise Inventory, January 1, 201616,000
Merchandise Inventory, December 31, 201611,000
Rise & Shine Company sells alarm clocks. The following information summarizes Rise & Shine’s operating activities for 2016:
Requirements
1. Calculate the operating income for 2016.
2. Rise & Shine sold 50,000 alarm clocks in 2016. Compute the unit cost for one alarm clock.
Sales Revenue $ 421,000
Requirement 1: Calculate the operating income for 2016.
Demonstration of E16-25
Sales Revenue $ 421,000
Cost of Goods Sold:
Beginning Merchandise Inventory $ 16,000
Requirement 1: Calculate the operating income for 2016.
Demonstration of E16-25
Sales Revenue $ 421,000
Cost of Goods Sold:
Beginning Merchandise Inventory $ 16,000
Purchases 208,000
Requirement 1: Calculate the operating income for 2016.
Demonstration of E16-25
Sales Revenue $ 421,000
Cost of Goods Sold:
Beginning Merchandise Inventory $ 16,000
Purchases 208,000
Cost of Goods Available for Sale 224,000
Requirement 1: Calculate the operating income for 2016.
Demonstration of E16-25
Sales Revenue $ 421,000
Cost of Goods Sold:
Beginning Merchandise Inventory $ 16,000
Purchases 208,000
Cost of Goods Available for Sale 224,000
Ending Merchandise Inventory (11,000)
Requirement 1: Calculate the operating income for 2016.
Demonstration of E16-25
Sales Revenue $ 421,000
Cost of Goods Sold:
Beginning Merchandise Inventory $ 16,000
Purchases 208,000
Cost of Goods Available for Sale 224,000
Ending Merchandise Inventory (11,000)
Cost of Goods Sold 213,000
Requirement 1: Calculate the operating income for 2016.
Demonstration of E16-25
Sales Revenue $ 421,000
Cost of Goods Sold:
Beginning Merchandise Inventory $ 16,000
Purchases 208,000
Cost of Goods Available for Sale 224,000
Ending Merchandise Inventory (11,000)
Cost of Goods Sold 213,000
Gross Profit 208,000
Requirement 1: Calculate the operating income for 2016.
Demonstration of E16-25
Sales Revenue $ 421,000
Cost of Goods Sold:
Beginning Merchandise Inventory $ 16,000
Purchases 208,000
Cost of Goods Available for Sale 224,000
Ending Merchandise Inventory (11,000)
Cost of Goods Sold 213,000
Gross Profit 208,000
Selling and Administrative Expenses 147,000
Requirement 1: Calculate the operating income for 2016.
Demonstration of E16-25
Sales Revenue $ 421,000
Cost of Goods Sold:
Beginning Merchandise Inventory $ 16,000
Purchases 208,000
Cost of Goods Available for Sale 224,000
Ending Merchandise Inventory (11,000)
Cost of Goods Sold 213,000
Gross Profit 208,000
Selling and Administrative Expenses 147,000
Operating Income $ 61,000
Requirement 1: Calculate the operating income for 2016.
Demonstration of E16-25
Requirement 2: Rise & Shine sold 50,000 alarm clocks in 2016. Compute the unit cost for one alarm clock.
Unit cost of one alarm clock =
Demonstration of E16-25
© 2016 Pearson Education, Ltd. 16-30
Requirement 2: Rise & Shine sold 50,000 alarm clocks in 2016. Compute the unit cost for one alarm clock.
Unit cost of one alarm clock =Cost of goods sold
Total units sold
Demonstration of E16-25
© 2016 Pearson Education, Ltd. 16-31
Requirement 2: Rise & Shine sold 50,000 alarm clocks in 2016. Compute the unit cost for one alarm clock.
Unit cost of one alarm clock =Cost of goods sold
Total units sold
= $213,00050,000 alarm clocks
Demonstration of E16-25
© 2016 Pearson Education, Ltd. 16-32
Requirement 2: Rise & Shine sold 50,000 alarm clocks in 2016. Compute the unit cost for one alarm clock.
Unit cost of one alarm clock =Cost of goods sold
Total units sold
= $213,00050,000 alarm clocks
= $4.26 per alarm clock
Demonstration of E16-25
© 2016 Pearson Education, Ltd. 16-33