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Computing cost of goods sold, manufacturing company

Use the following information to calculate the cost of goods sold for The Ellis Company for the month of June:

Finished Goods Inventory:

Beginning Balance $ 30,000

Ending Balance 10,000

Cost of Goods Manufactured 165,000

Short Answer

Expert verified

The cost of goods sold is computed as $185,000

Step by step solution

01

Definition of Finished goods

The finished goods are defined as goods which converted to the end product from the raw materials.

02

Computation of Cost of goods sold

Costs of goods solds=Begining balance+Cost of goods manufacture-Ending balance

=$30,000+$1,65,000-$10,000

=$1,85,000

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Question:Preparing a schedule of cost of goods manufactured and an income statement for a manufacturing company

Gourmet Bones manufactures its own brand of pet chew bones. At the end of December 2018, the accounting records showed the following:

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4. Based on 2015 sales, how much would operating income increase if the company reduced the average cost of goods sold to equal their competitorโ€™s average cost of goods sold?

5. How could managers at Winnebago use managerial accounting to reduce costs and increase profits?

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