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Statement of cost of goods sold?
Hi, I found this exercise, but I have a problem. This is the text:
The Tube Co. manufactures thermionic valves for audio equipment applications. At the end of 2012, its accounting records showed the following: Inventories Beginning Ending Materials 1200 2800 Work in process 4800 2100 Finished goods 2300 5700 Direct Material purchases 16000 Sales revenue 108500 Plant maintenance services 6000 Sales salaries expense 12000 Freight-out costs 4500 Utilities for plant 6600 Plant depreciation 8000 Customer service expenses 14000 Interest expenses 9500 Income taxes 5800 Direct Labor 21000 Required: a) Prepare a statement of cost of goods sold for the year ended Dec. 31st, 2012. My question is about the requirement of this problem: in my book the financial statements mentioned are the "classics" (income statement, cash flow statement, balance sheet, retained earnings statement), so what does it mean "cogs statement"? Thank you |
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The only component that affects Cost of Goods sold is Finished Goods so you have to calculate the inputs and outputs of the various inventories to arrive at the movements in Finished Goods inventory.
Presumably you are being asked to detail these movements. We are not told which costing system is in use so you will have to make the call on what part of Plant Overhead is to be included. |
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