Question

Manufacturing cost data for Orlando Company, which uses a job order cost system, are presented below. Indicate the missing amount for each letter. Assume that in all cases manufacturing overhead is applied on the basis of direct labor cost and the rate is the same. (Round overhead rate to 2 decimal places, e.g. 15.25 and final answers to O decimal places, e.g. 5,275.) Case A Case B Direct materials used $93,600 Direct labor 54,000 146,500 Manufacturing overhead applied 32,400 Total manufacturing costs 155,550 Work in process 1/1/20 23,900 Total cost of work in process 205,300 Work in process 12/31/20 16,600 Cost of goods manufactured 198,000

Answer 1

Ans:

A). Direct Materials used= Total Manufacturing costs- Direct Labor- Manufacturing overhead applied

= 155,550-54,000-32,400

=$ 69,150

B). Work in process 1/1/20= Total cost of work in process- Total Manufacturing costs

=205,300- 155,550

= $ 49,750

C). Work in process 12/31/20= Total Cost of work in process - cost of goods manufactured

= 205,300-198,000

=$ 7,300

D). It is given that manufacturing overhead applied is 32,400 and direct labor is 54,000

Overhead rate= Manufacturing overhead applied/ Direct labor*100

= (32,400/54,000)*100

= 60% (given in cases manufacturing overhead is applied on basis of direct labor and rate is same).

Manufacturing overhead applied= Overhead rate* direct labor

= 60% of 146,500

= 87,900

E). Total manufacturing costs= direct labor+ direct materials+ manufacturing overhead applied

= 146,500+93,600+ 87,900

= $ 328,000

F). Total cost of work in process = Work in process 1/1/20+ Total Manufacturing costs

= 23,900+ 328,000

= 351,900

G). Cost of goods manufactured = Total Cost of work in process - Work in process 12/31/20

= 351,900-16,600

= 335,300