Question

Raw materials inventory, beginning of year                 $21,000

Raw materials inventory, end of year                             23,000

Work in process inventory, beginning of year                55,000

Work in process inventory, end of year                          52,000

Finished goods inventory, beginning of year                  42,000

Finished goods inventory, end of year                            48,000

Raw materials purchased                                                 110,000

Indirect Materials used                                                        6,000

Indirect Labor used                                                             33,000

Direct Labor used                                                             210,000

Depreciation on Factory Machines                                 22,000

Amount spent on other manufacturing overhead       90,000

Direct labor hours used                                                     15,000

Predetermined overhead rate                                               $10 per direct labor hour

Please use the information above to calculate the following:

1. Raw materials used
2. Direct materials used
3. Manufacturing overhead costs incurred
4. Manufacturing overhead applied to jobs
5. Total manufacturing costs
6. Cost of goods manufactured
7. Unadjusted cost of goods sold
8. Adjusted cost of goods sold

Answer 1

a. and b.

Direct Materials
Raw Material Beginning Inventory	$                    21,000
Raw Material Purchases	$                1,10,000
Less : Raw Material Inventory	$                    23,000
Raw Material Used	$                1,08,000
Less : Indirect Materials	$                      6,000
Direct Material used	$                1,02,000

c. Manufacturing Overhead incurred = $6000+33000+22000+90000 = $151000

d. Manufacturing Overhead applied = 15000 x $10 = $150000

e. and f.

Direct Material used		$              1,02,000
Direct Labor		$              2,10,000
Manufacturing Overhead applied		$              1,50,000
Total Manufacturing Costs		$              4,62,000
Beginning Work in process inventory		$                 55,000
		$              5,17,000
Less: Ending Work in Process inventory		$                 52,000
Cost of goods manufactured		$              4,65,000

g. and h.

Beginning Finished Goods Inventory	$                    42,000
Add : Cost of Goods manufactured	$                4,65,000
Cost of Goods Available for sale	$                5,07,000
Less : Ending Finished Goods Inventory	$                    48,000
Unadjusted Cost of Goods Sold		$              4,59,000
Under-/Overapplied Overhead		$                    1,000
Adjusted Cost of Goods Sold		$              4,60,000