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:
Balances: Beginning Ending
Direct Materials \( 13,500 \) 7,500
Work-in-Process Inventory 0 3,500
Finished Goods Inventory 0 5,200
Other information:
Direct materials purchases$ 36,000
Plant janitorial services 700
Sales salaries 6,000
Delivery costs1,300
Net sales revenue 107,000
Utilities for plant 1,300
Rent on plant 17,000
Customer service hotline costs 1,200
Direct labor23,000
Requirements
1. Prepare a schedule of cost of goods manufactured for Gourmet Bones for the year ended December 31, 2018.
2. Prepare an income statement for Gourmet Bones for the year ended December 31, 2018.
3. How does the format of the income statement for Gourmet Bones differ from the income statement of a merchandiser?
4. Gourmet Bones manufactured 17,900 units of its product in 2018. Compute the company’s unit product cost for the year, rounded to the nearest cent.
