Question

Selected T-accounts for Moore Company are given below for the just completed year: Raw Materials Manufacturing Overhead Credits Debits 220,000 Credits Bal. 1/1 Debits 34,000 440,000 Bal. 12/31 51,000 Work in Process Debits Factory Wages Payable 172,000 Bal. 1/1 Credits Credits 460,000 Bal. 1/1 Direct materials 75,000 321,000 18,000 185,000 Direct labor Overhead 155,000 263,500 Bal. 12/31 31,000 Bal. 12/31 ? Finished Goods Cost of Goods Sold Bal. 1/1 Debits 45,000 Credit Debits Bal. 12/31 135,000

Answer 1

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Overhead Applied	From Work in process account	$   263,500	a
Direct Material Cost	From Work in process account	$   321,000	b
Overhead application Rate		82.09%	a/b
Ending Balance in work in process		$   354,500
Less: Direct Labor		$   (32,600)
Direct Material+Overhead		$   321,900
Lets assume, Direct Material cost is x
x+(0.8209x)=	$                                                      321,900
1.8209x=	$                                                      321,900
x=	$                                                      176,781
Direct Material Cost	$                                                      176,781
Manufacturing overheads	$                                                      145,119
($321,900-$176,781)