(WIP) ACC 350 Exam 1 Study Material
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COMPUTATIONAL QUESTION<br />
13. Pringlay Company had the following transactions last month:<br />
Purchased Raw <strong>Material</strong>s - $10,000<br />
Issues RM as supplies - $1,000<br />
Incurred Direct labor costs - $5,000<br />
Paid freight-in - $2,000<br />
Paid freight-out - $7,000<br />
Depreciation on plant - $6,000<br />
Depreciation on office equipment - $4,000<br />
Plant manager’s salary - $2,500<br />
Quality Inspector’s salary - $1,500<br />
Marketing Manager’s salary - $3,500<br />
Sales Commissions – 5% of sales<br />
Sales - $65,000<br />
Ending Raw <strong>Material</strong>s Inventory increased $3,000 from beginning of the month<br />
Ending <strong>WIP</strong> Inventory did not change from beginning of the month<br />
Ending FG Inventory decreased $8,000 from the beginning of the month<br />
What was COGS for last month?<br />
+ Purchases 12,000 Include freight-in<br />
- Indirect RM Issues 1,000<br />
- Increase in RM Inventory 3,000<br />
DM used in Production $8,000<br />
DL 5,000<br />
Manufacturing Overhead 11,000 RM Supplies + Depr on plant + Plant Mgr<br />
Salary + Quality Inspector salary<br />
Total Manufacturing Costs $24,000<br />
+ Beginning <strong>WIP</strong> 0<br />
- Ending <strong>WIP</strong> 0 No Change<br />
Cost of Goods Manufactured $24,000<br />
+ Reduction in FG 8,000<br />
Cost of Goods Sold $32,000<br />
The following items are SG&A Expenses:<br />
Freight-out<br />
Depreciation on office equipment<br />
Marketing manager’s salary<br />
Sales commissions