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28 February, 08:03

a company incurred the following costs: Selling and administrative expenses: $45,000; Direct materials: $15,000; income tax expense: $10,000, direct labor: $30,000; factory overhead: $5,000. Total manufacturing costs reported on the schedule of cost of goods manufactured

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  1. 28 February, 08:35
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    Cost of good manufactured = $50000

    Explanation:

    Total manufacturing cost is the aggregate amount of cost incurred by a business to produce goods in a reporting period.

    Generally accepted accounting principles require that the cost of goods sold shall consist of:

    the cost of direct materials

    the cost of direct labor

    the cost of manufacturing overhead

    Expenses that are outside of the manufacturing facilities, such as selling, general and administrative expenses, are not product costs. They are reported as expenses on the income statement in the accounting period in which they occur.

    In this exercise:

    Cost of goods manufactured:

    Direct materials = $15000

    Direct Labor=$30000

    Factory overhead=$5000

    Total = $50000
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