Problem 2-17 Schedule of Cost of Goods Manufactured; Income Statement; Cost Behaviour [LO1, LO2, LO3,...

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Accounting

Problem 2-17 Schedule of Cost of Goods Manufactured; Income Statement; Cost Behaviour [LO1, LO2, LO3, LO4, LO5]

The following information pertains to the most recent quarter at Precious Production Limited.


Purchases of raw materials	$	376,500
Raw materials inventory, beginning		44,400
Raw materials inventory, ending		73,500
Depreciation, factory		195,500
Insurance, factory		21,100
Direct labour		247,700
Maintenance, factory		124,400
Administrative expenses		288,800
Sales		2,064,000
Utilities, factory		113,500
Supplies, factory		4,110
Selling expenses		329,900
Indirect labour		267,700
Work in process inventory, beginning		28,550
Work in process inventory, ending		122,200
Finished goods inventory, beginning		41,650
Finished goods inventory, ending		166,600

Required:

1. Prepare a schedule of cost of goods manufactured.

2. Prepare an income statement.

3. Assume that the company produced the equivalent of 10,000 units of product during the quarter. What was the average cost per unit for direct labour? What was the average cost per unit for factory insurance? (Round your answers to 2 decimal places.)

4. Assume that the company expects to produce 12,000 units of product during the coming quarter. What average cost per unit and what total cost would you expect the company to incur for direct materials at this level of activity? For factory insurance? (In preparing your answer, assume that direct materials is a variable cost and that factory insurance is a fixed cost.) (Round "Average cost per unit" answers to 2 decimal places.)

5. This part of the question is not part of your Connect assignment.

6. Assuming the company produced 18,000 fully and partially finished units during the quarter, determine the cost components of the finished goods inventory, which is composed of 3,600 finished units.

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