Davis Manufacturing Company Had the Following Data

question 103

Short Answer

Davis Manufacturing Company had the following data:
Collections on account were $625,000.
Cost of goods sold was 68% of sales.
Direct materials purchased amounted to $90,000.
Factory overhead was 300% of the cost of direct labor.
Compute:
(a) Sales revenue (all sales were on account)
(b) Cost of goods sold
(c) Cost of goods manufactured
(d) Direct labor used
(e) Direct materials incurred
(f) Factory overhead incurred

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Definitions:

Partnership Agreement

A legal document that specifies the rights, responsibilities, and distribution of profits and losses among partners in a business partnership.

Salary Allowances

Salary allowances refer to the specific amounts granted to employees over their basic salary for various purposes, such as housing, transportation, or medical expenses.

Income Statements

A financial statement that shows a company's revenues and expenses over a specific period, leading to net profit or loss.

Drawing Accounts

Accounts used to track withdrawals made by the owners of a business for personal use, reducing the owner's equity in the company.