Keisha Tombert , the bookkeeper for Washington Consulting, a political consulting firm, has recently completed a managerial accounting course at her local college. One of the topics covered in the course was the cost of goods manufactured schedule. Keisha wondered if such a schedule could be prepared for her firm. She realized that, as a service-oriented company, it would have no work in process inventory to consider.
Listed below are the costs her firm incurred for the month ended August 31, 2021
Instructions
- Prepare a schedule of cost of contract services performed (similar to a cost of goods manufactured schedule) for the month.
- For those costs not included in (a), explain how they would be classified and reported in the financial statements.
Solution
a.
Keisha Tombert
Schedule of Cost of contact services provided
For the Month Ended August 31, 2021
Schedule of Cost of contact services provided
For the Month Ended August 31, 2021
b.
For those costs not included in the cost of contract services performed would be classified as periodic cost. They would be recorded in the income statement under administrative expenses.