Accounting 202

Chapter 14

Exercise 14-9

Part 1 - State whether each company is a manufacturing company or a merchandising company

Company 1 , Sun Fresh Foods , is a merchandising company

Company 2 , Salomon Skis Mfg , is a manufacturing company

Part 2 (Be sure to list the current assets in of liquidity . Omit the " sign in your response

Company 1

Sun Fresh Foods

Current Asset Section

December 31 , 2008

Cash

Marketable securities

Accounts receivable

Merchandise inventory

Prepaid expenses

Company 2

Salomon Skis Mfg

Current Asset

Section

December 31 , 2008

Cash

Marketable securities

Accounts receivable

Finished goods inventory

Goods in process inventory

Raw materials inventory

Prepaid expenses

Exercise 14-10 (Omit the " sign in your response

Merchandising Business

Viking Retail

Partial Income Statement

For Year Ended December 31 , 2008

Sales

Less : Cost of goods sold

Beginning merchandise inventory

Add : Purchases during the period

br Less : Ending merchandise inventory

Cost of goods sold 660 ,000

Gross Profit Manufacturing Business

Log HOMES

Partial Income Statement

For Year Ended December 31 , 2008

Sales

Less : Cost of goods sold

Beginning raw materials inventory

Add : Raw materials purchased during the period

br Less : Ending raw materials inventory

br Direct Labor

Factory Overhead

br Add : Beginning goods in process inventory

br Less : Ending goods in process inventory

br Add : Beginning finished goods inventory

br Less : Ending finished goods inventory

Cost of goods sold

Gross Profit

Exercise 14-11 (Omit the " sign in your response

Garcia Company Culpepper

Company

1 . Cost Of Goods Manufactured

Direct materials Beginning raw materials inventory 7 ,250 9 ,000

Add : Raw materials purchases Raw materials available for use Less : Ending raw materials inventory Raw materials used Direct labor Factory overhead Indirect materials Indirect labor Power and electricity Depreciation of plant equipment Factory rent expense Add : Beginning goods in process Less : Ending goods in process Cost of goods manufactured 96 ,680 2 . Cost Of Goods Sold

Beginning finished goods inventory

Add : Cost of goods manufactured

139 ,860

Less : Ending finished goods inventory Cost of goods sold 91 ,030 Exercise 14-13 (Omit the " sign in your response

Shanta COMPANY

Manufacturing Statement

For Year Ended December 31 , 2008

Direct materials Beginning raw materials inventory

Add : Raw materials purchases during the period Raw materials available for use Less : Ending raw materials inventory Direct materials used Direct Labor Factory overhead Indirect materials Indirect labor Power and electricity Depreciation of plant equipment Factory rent expense Add : Beginning goods in process Less : Ending goods in process Cost of goods manufactured 534 ,390 Exercise 14-14 (Omit the " sign in your response

Shanta COMPANY

Income Statement

For Year Ended December 31 , 2008

Sales

Cost of goods sold Beginning merchandise inventory

Add : Purchases during the period Less : Ending merchandize inventory Gross profit Operating expenses Salaries and wages Representation and entertainment Telephone and communication Operating income PAGE - 4 -

NAME Ch14_Hints...