CHAPTER 16 ALTERNATE PROBLEMS
An Introduction to Product Costs
Pisna, Inc. manufactures dowhats. The manufacturing costs incurred during its first year of operations are shown as follows:
Direct materials purchased$400,000
Direct materials used385,000
Direct labor assigned to production350,000
Cost of finished goods manufactured (100 dowhats)900,000
During the year, 100 completed dowhats were manufactured, of which 90 were sold. (Assume the amount of the ending inventory of finished goods and the cost of goods sold are determined using the average-per-unit cost of manufacturing a completed dowhat.
Compute each of the following and show all computations:
The average per-unit cost of manufacturing a completed dowhat during the current year.
The year-end balances of the inventories of materials, work in progress, and finished goods.
The cost of goods sold during the year.
For the current year, the costs of direct materials purchased, direct labor assigned to production, and actual manufacturing overhead total $1,175,000. Is this the amount of manufacturing costs deducted from revenue in the current year? Explain fully.
Alternate Problems for use with Financial and Managerial Accounting, 12e16-1
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