Reference no: EM13709363
Runcke Motor Company manufactures automobiles. During Sept. 2011 the company purchased 5,000 head lamps at a cost of $9 per lamp. Runcke withdrew 4,650 lamps from the warehouse during the month.
50 of these lamps were put in the autos manufactured during the month. Of the autos put into production during September 2011, 90% were completed and transferred to the company's storage lot.
Of the cars completed during the month, 75% were sold by septemeber 30. Determine the amount of cost to appear in various accounts, and indicate in which financial statements, these accounts would appear.
a. Determine the cost of head lamps that would appear in each of the following accounts at September 30, 2011: Raw Materials, Work in Process, Finished Goods, Cost of Goods Sold and Selling Expenses.
b. Write a short memo t the chief accountant, indicating whether and where each of the accounts in (a) would appear on the income statement or on the balance sheet at September 30,2011.
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: Determine the cost of head lamps that would appear in each of the following accounts at September 30, 2011: Raw Materials, Work in Process, Finished Goods, Cost of Goods Sold and Selling Expenses.
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