Scenario: YUM YUM COOKIES Company manufactures cookies. Materials are added in the Baking Department. After processing, the cookies are…
Scenario: YUM YUM COOKIES Company manufactures cookies. Materials are added in the Baking Department. After processing, the cookies are moved to the Packing Department where more materials are added. The completed packages are then moved to Finished Goods. Task: Using the data below the month of July, determine the July Gross Profit using FIFO inventory methods. June 30: Raw Material Inventory: $235,000 Baking Department : WIP # = 0 WIP $$ = 0 Packing Department : WIP # = 6000 cases at 80% completion, WIP$ = $95,000 Finished Goods Inventory : WIP # 20,000 cases WIP $ = $300,000 July Transactions: Materials Purchased on Account: $520,000 # Cases started: Baking Department: 50,000 Packing Department: 35,000 Materials Requisitioned: Baking Dept: $225,000 DM, $25,000 IM Packing Dept: $40,250 DM, $9,750 IM Labor Costs: Baking Dept: $106,000 DL, $12,000 IL Packing Dept: $60,000 DL, $17,000 IL Misc. Expenses: Baking Dept: $18,000 Packing Dept: $14,600 Prepaid Expenses: Baking Dept: $4,500 Packing Dept: $1000 Depreciation Expenses: Baking Dept: $46,000 Packing Dept: $ 15,000 FOH Applied: Baking Dept: $86,700 Packing Dept: $30,345 Sales on Account: 47,000 cases at $42 per case July 31 WIP Baking Dept: WIP = 40% complete Packing Dept: 5000 cases at 10% completion
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