Frost corporation incurred the following transactions during its first year of operations. (assume all transactions involve cash.) 1) acquired $1,900 of capital from the owners. 2) purchased $435 of direct raw materials. 3) used $290 of these direct raw materials in the production process. 4) paid production workers $490 cash. 5) paid $290 for manufacturing overhead (applied and actual overhead are the same). 6) started and completed 250 units of inventory. 7) sold 140 units at a price of $6 each. 8) paid $130 for selling and administrative expenses. the amount of raw material inventory on the balance sheet at the end of the accounting period would be:
The necessary inputs for a new work flow in the production unit, would include: the raw materials, information, human resources and equipment.
The raw materials are the unprocessed units used for production, the human resources are employees that carryout production tasks, the information is the steps of production and the equipments are the machines used to make production easier.
The journal entries are shown below:
1. Raw material inventory A/c Dr $81,000
To Accounts payable A/c $81,000
(Being the raw material is purchased on account)
2. Work in process inventory A/c Dr $66,000
Manufacturing overheads A/c Dr $6,000
To Raw material inventory A/c Dr $72,000
(Being the use of the material is recorded)
Net income for the year = $120
a) Data and Calculations:
Direct materials cost = $400
Direct labor cost = 800
Manufacturing overhead 400
Total manufacturing cost $1,600
Cost per unit = $8
Ending Inventory of finished goods = 150 units * $8 = $1,200
Cost of goods sold = 50 * $8 = $400
Sales revenue = 50 * $12 = $600
For the year ended December 31:
Sales Revenue $600
Cost of goods sold 400
Gross income $200
Selling & Admin.
Net Income $120
b) Newton Corporation's net income is the difference between the Sales Revenue, cost of goods sold and selling and administrative expenses.
The correct answer is D
Inputs is the term which is defined as the resources required or invested in order to accomplish or finish the task and usually it involve effort, time and money.
So, in this case, the manufacturing company where the production manager works with the human resource in order to design the new work flow for production unit. Then the required inputs are human resource, raw materials, information and equipment.