P16-25A Charlie’s Pets succeeded so well that Charlie decided to manufacture his own brand of chewing bone—Fido Treats

Charlie’s Pets succeeded so well that Charlie decided to manufacture his own brand of chewing bone—Fido Treats. At the end of December 2012, his accounting records showed the following:

Inventories: Beginning Ending

Materials $ 13,400 $ 9,500

Work in process 0 2,000

Finished goods 0 5,300

Other information:

Direct material purchases $ 33,000

Utilities for plant $ 1,600

Plant janitorial services 800 Rent of plant 13,000

Sales salaries expense 5,000 Customer service hotline expense 1,400

Delivery expense 1,700 Direct labor 22,000

Sales revenue 109,000

Requirements:

1.Prepare a schedule of cost of goods manufactured for Fido Treats for the year ended December 31, 2012.

2.Prepare an income statement for Fido Treats for the year ended December 31, 2012.

3.How does the format of the income statement for Fido Treats differ from the income statement of a merchandiser?

4.Fido Treats manufactured 18,075 units of its product in 2012. Compute the company’s unit product cost for the year.