Alhambra Aluminum Company
Alhambra Aluminum Company, a manufacturer of recyclable soda cans, had the following inventory balances at the beginning and end of 20x1.
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Inventory Classification
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January 1, 20x1
|
December 31, 20x1
|
|
Raw material
|
$ 55,000
|
$ 75,000
|
|
Work in process
|
110,000
|
125,000
|
|
Finished goods
|
160,000
|
155,000
|
During 20x1, the company purchased $240,000 of raw material and spent $420,000 for direct labor. Manufacturing overhead costs were as follows:
|
Indirect material
|
$ 12,000
|
|
Indirect labor
|
22,000
|
|
Depreciation on plant and equipment
|
110,000
|
|
Utilities
|
23,000
|
|
Other
|
35,000
|
Sales revenue was $1,210,000 for the year. Selling and administrative expenses for the year amounted to $105,000. The firm's tax rate is 35 percent.
Required:
1. Prepare a schedule of cost of goods manufactured.
2. Prepare a schedule of cost of goods sold.
3. Prepare an income statement.
4. Build a spreadsheet: Construct an Excel spreadsheet to solve all of the preceding requirements. Show how both cost schedules and the income statement will change if the following data change: direct labor is $410,000 and utilities cost $24,000.