Manufacturing cost flow for one-year period Burnside Manufacturing started 2011 with the following account balances. Transactions during

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Manufacturing cost flow for one-year period Burnside Manufacturing started 2011 with the following account balances.


Cash Common stock Retained earnings Raw materials inventory Work in process inventory Finished goods inventory (50 units


Transactions during 2011
1. Purchased $750 of raw materials with cash.
2. Transferred $500 of raw materials to the production department.
3. Incurred and paid cash for 80 hours of direct labor at $7.50 per hour.
4. Applied overhead costs to Work in Process Inventory. The predetermined overhead rate is $7.50 per direct labor hour.
5. Incurred actual overhead costs of $650 cash.
6. Completed work on 300 units for $3.60 per unit.
7. Paid $200 in selling and administrative expenses in cash.
8. Sold 200 units for $1,500 cash revenues. (Assume LIFO cost flow.) Burnside charges overapplied or underapplied overhead directly to Cost of Goods Sold.
Required
a. Record the preceding events in a horizontal statements model. The beginning balances are shown as an example.

Manufacturing cost flow for one-year period Burnside Manufacturi


b. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet for 2011.

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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