Reference no: EM132510404

Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct
materials):

Selling expenses                                     213,000

Purchases of raw materials                           268,000

Direct labor                                                 ?

Administrative expenses                                $155,000

Manufacturing overhead applied to work in process $ 370,000

Actual manufacturing overhead cost             $ 351,000

Inventory balances at the beginning and end of the year were as follows:

                                              Beginning of Year             End of Year
Raw materials                      $ 52,000                        $ 30,000
Work in process                   ?                                  $ 24,000
Finished goods                      $ 32,000                        ?

The total manufacturing costs for the year were $680,000; the cost of goods available for sale totaled $745,000; the unadjusted cost of goods sold totaled $670,000; and the net operating income was $38,000. The company's underapplied or overapplied overhead is closed to Cost of Goods Sold.

Required:

Question 1: Prepare schedules of cost of goods manufactured and cost of goods sold and an income statement. (Hint: Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.)