Problems

Problem 1

Required: Use the following information to complete the below schedule of cost of goods manufactured.


(25 points)

Purchases of raw materials $120,000.00
Raw materials available for use $148,000.00
Cost of direct raw materials used $124,000.00
Manufacturing overhead $24,000.00
Total manufacturing costs $310,000.00
Ending work-in-process inventory ($46,000.00)
Cost of goods manufactured $306,000.00


Schedule of Cost of Goods Manufactured

Beginning inventory, raw materials $28,000.00
Plus: Purchases of raw materials $120,000.00
Raw materials available for use $148,000.00
Less: Ending raw materials inventory ($24,000.00)
Cost of direct raw materials used $124,000.00
Direct labor $162,000.00
Manufacturing overhead $24,000.00
Total manufacturing costs $310,000.00
Plus: Beginning work-in-process inventory $42,000.00
Total work in process $352,000.00
Less: Ending work-in-process inventory ($46,000.00)
Cost of goods manufactured $306,000.00

Problem 2

Required: JZ is a musician who is considering whether to independently produce and sell a CD. JZ estimates fixed costs of $10,000 and variable costs of $4.00 per unit. The expected selling price is $12 per CD. What is JZ's break-even point in units and dollars?



(25 points)
Break-even point in units Fixed Costs 10000/(12-4) 1250
Contribution margin per unit


Break-even point in dollars Break-even point in units * selling price 1250 * 12 $15,000.00