Santana Rey, owner of Business Solutions, decides to diversify her business by also manufacturing computer workstation furniture.

Required
1. Classify the following manufacturing costs of Business Solutions by behavior and traceability.

2. Prepare a manufacturing statement for Business Solutions for the month ended January 31, 2012. Assume the following manufacturing costs:
Direct materials: $2,200
Factory overhead: $490
Direct labor: $900
Beginning goods in process: none (December 31, 2011)
Ending goods in process: $540 (January 31, 2012)
Beginning finished goods inventory: none (December 31, 2011)
Ending finished goods inventory: $350 (January 31, 2012)
3. Prepare the cost of goods sold section of a partial income statement for Business Solutions for the month ended January 31,2012.

Transcribed Image Text:

Cost by Behavior Cost by Traceability Product Costs Variable Fixed Direct Indirect l. Monthly flat fee to clean workshop. . . . 2. Laminate coverings for desktops 3. Taxes on assembly workshop... 4. Glue to assemble workstation ages of desk assembler .^.. 6. Electricity for workshop 7. Depreciation on toolsR