The following costs and revenue pertain to the Swiss ChocolateManufacturing Company, a U.S. producer of chocolate bars, for July2015.
Swiss Chocolate Manufacturing Company
Jun-15
Jul-15
Raw materials inventory
$ 77,000
91,000
Work-in-process inventory
$ 73,500
70,000
Finished goods inventory
$ 63,000
80,500
Purchases of raw materials
$ 262,500
Direct manufacturing labor
87,500
Indirect manufacturing labor
52,500
Factory insurance
31,500
Depreciation — machinery and factory
38,500
Repairs and maintenance — factory
14,000
Selling, marketing and distribution expenses
40,000
General and administrative expenses
60,000
Revenues
$ 1,050,000
Requirements:
Complete the cost of goods manufactured statement for SwissChocolate for July 2015.
Complete the income statement for Swiss Chocolate (assume thatthe company incurs no interest financing costs and has a tax rateof 30%).
Compute Swiss Chocolate’s gross profit margin and net profitmargin for July 2015. Recall that the gross profit marginpercentage = gross profit margin/revenue, and net profit margin =net profit margin/revenue.
Swiss Chocolate’s closest publicly held competitor has a grossmargin percentage of 50% and a net profit margin of 15%. CompareSwiss Chocolate’s performance for July 2015 to that of itscompetitor. What do you note regarding relative production cost andrelative period costs in this comparison? Which company appeared tohave performed better? Explain your answer.
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