Read and choose the option with the regular verb in the imperfect tense.
A. Tú leías hechizos.
B. Tú hablaste con la maestra.
C. Tú usaste un huso.
D. Tú vas al parque.
Answer (1)
Calculate the cost of direct raw materials consumed: $28,000 + $358,000 - $25,000 = $361,000.
Calculate the total factory overheads: $88,000 + $104,000 + $82,000 + $36,000 = $310,000.
Calculate the total cost of production: $360,000 + $361,000 + $310,000 + $58,000 - $60,000 = $1,029,000.
Calculate the cost of goods sold: $33,000 + $1,029,000 - $35,000 = \boxed{$1,027,000}.
Explanation
Problem Analysis and Data Collection We are given a table of financial data and asked to determine the cost of goods sold. To do this, we will follow a standard cost accounting approach. We will calculate the cost of direct raw materials consumed, the total factory overheads, the total cost of production, and finally, the cost of goods sold. We are given the following:
Sales = $1,800,000 Machinery = $180,000 Canteen Equipment = $100,000 Office Machinery = $100,000 Debtors = $189,000 Capital = $40,000 Purchase of Direct raw materials = $358,000 Stock as at April 1, 2021: Direct Raw Materials = $28,000 Stock as at April 1, 2021: Work -in-progress = $58,000 Stock as at April 1, 2021: Finished Goods = $33,000 Direct Factory Wages = $360,000 Indirect Wages = $88,000 License fees to manufacture products = $104,000 Property expenses = $82,000 Canteen expenses = $36,000 Other Administration expenses = $40,000 Selling and distribution expenses = $47,000 Office salaries = $90,000 Provision for doubtful debts = $3,000 We will assume the following closing stock values: Closing Stock of Direct Raw Materials = $25,000 Closing Stock of Work-in-progress = $60,000 Closing Stock of Finished Goods = $35,000
Calculate Cost of Direct Raw Materials Consumed First, we calculate the cost of direct raw materials consumed. This is calculated as:
Opening Stock of Direct Raw Materials + Purchase of Direct Raw Materials - Closing Stock of Direct Raw Materials
28 , 000 + 358 , 000 − 25 , 000 = 361 , 000
So, the cost of direct raw materials consumed is $361,000.
Calculate Total Factory Overheads Next, we calculate the total factory overheads. This includes:
Indirect Wages + License fees to manufacture products + Property expenses + Canteen expenses
88 , 000 + 104 , 000 + 82 , 000 + 36 , 000 = 310 , 000
Thus, the total factory overheads are $310,000.
Calculate Total Cost of Production Now, we calculate the total cost of production. This is calculated as:
Direct Factory Wages + Cost of Direct Raw Materials Consumed + Total Factory Overheads + Opening Work-in-progress - Closing Work-in-progress
360 , 000 + 361 , 000 + 310 , 000 + 58 , 000 − 60 , 000 = 1 , 029 , 000
Therefore, the total cost of production is $1,029,000.
Calculate Cost of Goods Sold Finally, we calculate the cost of goods sold. This is calculated as:
Opening Stock of Finished Goods + Cost of Production - Closing Stock of Finished Goods
33 , 000 + 1 , 029 , 000 − 35 , 000 = 1 , 027 , 000
So, the cost of goods sold is $1,027,000.
Final Answer The cost of goods sold is $1,027,000.
Examples
Understanding the cost of goods sold (COGS) is crucial for any business. For example, a bakery needs to know how much it costs to produce its goods to set prices and ensure profitability. By calculating the cost of raw materials (flour, sugar, etc.), labor (bakers' wages), and overhead (rent, utilities), the bakery can determine its COGS. This information helps the bakery make informed decisions about pricing, production levels, and cost-saving measures, ultimately contributing to its financial health.
