Question

Exercise 1-2 Presented below is a list of costs and expenses usually incurred by Barnum Corporation, a manufacturer of furniture, in its factory. Classify the below items into the following categories: (a) direct materials, (b) direct labor, and (c) manufacturing overhead. Item Category 1Salaries for assembly line inspectors. Insurance on factory machines Property taxes on the factory building. Factory repairs E Upholstery used in manufacturing furniture Wages paid to assembly line workers. Factory machinery depreciation. Glue, nails, paint, and other small parts used in production, 9 Factory supervisors' salaries. Wood used in manufacturing furniture. Exercise 1-4 Knight Company reports the following costs and expenses in May. 70 300 46,700 3,100 Factory utilities Depreciation on factory equipment Depreciation on delivery trucks for sales office Indirect factory labor indirect materials Direct materials used Factory manager's salary $17,400 Direct labor 5 13,850l Sales salaries 20l | Property taxes on factory 3,900 on factory building 2001 Repairs to sales office 53,700 lequipment 84,200l Factory repairs 137,700 Advertising 8,700 Sales Office supplies used 1,500 2,220 15.900 2.770 . Determine the total amount of manufacturing overhead. Show work. b. Determine the total amount of product costs. Show work. .. Determine the total amount of period costs. Show work.

Answer 1

Exercise 1-2

Classification of items into (a) direct materials, (b) direct labor and (c) manufacturing overhead: Item Classification Direct labor or Salaries for assembly line inspectors. Manufacturing overhead Insurance on factory machines. Manufacturing overhead Property taxes on the factory building. Manufacturing overhead Factory repairs. Manufacturing overhead Upholstery used in manufacturing furniture. Direct materials Wages paid to assembly line workers. Direct labor Factory machinery depreciation. Manufacturing overhead Glue, nails, paint, and other small parts used in production. Manufacturing overhead Factory supervisors' salaries. Manufacturing overhead Wood used in manufacturing furniture. Direct materials

Exercise 1-4

(a) Manufacturing overhead: Factory utilities Depreciation on factory equipment Indirect factory labor Indirect materials Factory manager's salary Property taxes on factory building Factory repairs Total $17,400 $13,850 $53.700 $84,200 $8,700 $3,100 $2,220 $183,170 b) Direct materials Direct labor Manufacturing overhead Total $137,700 $70,300 $183,1701 $391,170 (c) | Depreciation on delivery trucks Sales salaries Repairs to office equipment Advertising Office supplies used Total $3,900 $46,700 $1,500 $15,900 $2,770 $70,7701

Exercise 1-8

$126.000 $115,200 D) Compute cost of goods manufactured Materials used in product Labor costs of assembly-line workers Factory overheads Depreciation on plant Property taxes on plant Factory supplies used Add WIP Less: WIP Cost of goods manufactured $ 65,900 $ 23,500 $ 32,200 $ 14,400 $ (17,400 $359,800 (b) Compute cost of goods sold Beginning FG Cost of goods mfd Less: Ending FG COGS $ 64,000 $359,800 $ (45,900) $377,900 The other items not used above are operating expenses and do not go into the calculation of either (a) or (b)