Question

Problem from Managerial accounting. Thanks a lot.

P3.35A Analyze a job-order cost system and calculate work in process. (LO 3) 20n November 30, 2020, there was a fire in the factory of Able Manufacturing Limited, where you work as the controller. The work in process in- ventory was completely destroyed, but both the ma- terials and finished goods inventories were undam- aged Able uses normal job-order costing and its fiscal year end is December 31. Selected information for the periods ended October 31, 2020, and Novemberi 30,2020, follows: Supplies (including both direct and indirect materials) Work in process inventory Finished goode inventory Cost of goods sold (year to date) Accounts payable (relates to materials purchased only $79.250 58 875H 60.000 576.000 17.960 $ 73250 63,000 656,000

Answer 1

Solution: Direct Materials Used Accounts payable an on Nov 30, 2020 Add: Payment made to suppliers Less: Accounts payable an on Oct 31, 2020 Supplies Purchased during November 53540 600001 17960 95580 Add: Supplies as on Oct 31, 2020 Less: Supplies as on Nov 30, 2020 Supplies Consumed during November Less: Indirect Materials Used Direct Materials Used 79250 73250 1015801 5848 95732 Manufacturing Overhead Applied Manufacturing Overhead Upto Nov 30, 2020 Less: Manufacturing Overhead Upto Oct 31, 2020 Manufacturing Overhead incurred during Nov Add: Overhead Overapplied Manufacturing Overhead Applied during Nov 1633001 129500 33800 2750 36550 957321 681231 36550 58873 Cost of Goods sold Direct Materials Direct labor (83500-15375) Manufacturing Overhead Applied Add: WIP Inventory as on Oct 31, 2020 Less: WIP Inventory as on Nov 30, 2020 Cost of Goods Manufactured during November Add: Finished Goods inventory Oct 31, 2020 Less: Finished Goods inventory Nov 30, 2020 Cost of Goods sold during November 2592821 600001 63000l 2562821 Cost of Work in process inventory Lost during Fire Cost of Goods sold during November Add: Cost of Goods sold upto Oct 31, 2020 Less: Cost of goods sold upto Nov 30, 2020 Cost of Work in process inventory Lost during Fire 256282 576000 656000 176282