The following balances are from the accounts of Tappan Parts: January 1 (Beginning) December 31 (Ending) Direct materials inventory $ 21,800 $ 24,600 Work-in-process inventory 32,300 29,200 Finished goods inventory 5,500 6,500 Direct materials used during the year amount to $46,000 and the cost of goods sold for the year was $52,700. Required: Prepare a cost of goods sold statement.

Tappan Parts:

Cost of goods sold statement:

Beginning inventory:

Direct materials              $21,800

WIP                                   32,300

Finished goods                 5,500

Total                              $59,600

Purchases of materials 53,400

Available                       $113,000    

less Ending inventory:

Direct materials            $24,600

WIP                                  29,200

Finished goods                 6,500

Total                              $60,300

Cost of goods sold       $52,700

Explanation:

a) Data and Calculations:

                                       January 1 (Beginning)         December 31 (Ending)

Direct materials inventory      $ 21,800                         $ 24,600

Work-in-process inventory       32,300                            29,200

Finished goods inventory          5,500                               6,500

Direct materials used during the year amount to $46,000 and the cost of goods sold for the year was $52,700

b) The missing figure in the above statement is the purchases of raw materials.  This is determined by adding the cost of goods sold to the ending inventory of raw materials, work in process, and finished goods.  This gives the cost of raw materials, WIP, and finished goods available for sale.  Then the beginning inventories of raw materials, WIP, and finished goods are deducted to obtain the amount of purchases of materials made during the period.