Cost of goods manufactured, income statement, manufacturing company.

Peterson Company

Schedule of Cost of Goods Manufactured

Year Ended December 31, 2014

(in thousands)

Direct materials cost

Beginning inventory, January 1, 2014 $ 21,000

Purchases of direct materials 74,000

Cost of direct materials available for use 95,000

Ending inventory, December 31, 2014 23,000

Direct materials used $ 72,000

Direct manufacturing labor costs 22,000

Indirect manufacturing costs

Indirect manufacturing labor 17,000

Plant insurance 7,000

Depreciation—plant building & equipment 11,000

Repairs and maintenance—plant 3,000

Total indirect manufacturing costs 38,000

Manufacturing costs incurred during 2014 132,000

Add beginning work-in-process inventory, January 1, 2014 26,000

Total manufacturing costs to account for 158,000

Deduct ending work-in-process inventory, December 31, 2014 25,000

Cost of goods manufactured (to Income Statement) $133,000

 Peterson Company

Income Statement

Year Ended December 31, 2014

(in thousands)

Revenues $310,000

Cost of goods sold:

Beginning finished goods, January 1, 2014 $ 13,000

Cost of goods manufactured 133,000

Cost of goods available for sale 146,000

Ending finished goods, December 31, 2014 20,000

Cost of goods sold 126,000

Gross margin 184,000

Operating costs:

Marketing, distribution, and customer-service costs 91,000

General and administrative costs 24,000

Total operating costs 115,000

Operating income $ 69,000