Question

E2-6 (Algo) Finding Unknown Values in the Cost of Goods Manufactured Report [LO 2-3, 2-6) Mulligan Manufacturing Company uses a job order cost system with overhead applied to products at a rate of 150 percent of direct labor cost. Required: Treating each case independently, selected from the manufacturing data given below, find the missing amounts. You should do them in the order listed. (Hint: For the manufacturing costs in Case 3, first solve for conversion costs and then determine how much of that is direct labor and how much is manufacturing overhead.) (Do not round your intermediate calculations. Round your final answers to the nearest whole dollar. Enter all amounts as positive values.) Case 2 Case 1 18,000 13,000 Case 3 9,300 10,500 25,000 31,200 8,100 Direct material used Direct labor Manufacturing overhead applied Total current manufacturing costs Beginning work in process inventory Ending work in process inventory Cost of goods manufactured Beginning finished goods inventory Ending finished goods inventory Cost of goods sold 8,700 4,900 8,400 40,000 10,000 28,001 3,900 8,300 6,500 40,000 33,000

Answer 1

	Case 1	Case 2	Case 3
Direct materials used	18000	7500	9300
Direct labor	13000	7000	8760
Manufacturing overhead applied	19500	10500	13140
Total current manufacturing costs	50500	25000	31200
Beginning work in process inventory	8700	23400	8100
Ending work in process inventory	4900	8400	11299
Cost of goods manufactured	54300	40000	28001
Beginning finished goods inventory	3900	10000	18499
Ending finished goods inventory	8300	17000	6500
Cost of goods sold	49900	33000	40000

Case 1

Manufacturing overhead applied= Direct labor*150%= $13000*150%= $19500

Total current manufacturing costs= Direct materials+Direct labor+Manufacturing overhead applied

= $18000+13000+19500= $50500

Cost of goods manufactured= Total current manufacturing costs+Beginning work in process inventory-Ending work in process inventory

= $50500+8700-4900= $54300

Cost of goods sold= Cost of goods manufactured+Beginning finished goods inventory-Ending finished goods inventory

= $54300+3900-8300= $49900

Case 2

Direct labor= Manufacturing overhead applied/150%= $10500/150%= $7000

Direct materials used= Total current manufacturing costs-Direct labor-Manufacturing overhead applied

= $25000-7000-10500= $7500

Beginning work in process inventory= Cost of goods manufactured+Ending work in process inventory-Total current manufacturing costs

= $40000+8400-25000= $23400

Ending finished goods inventory= Cost of goods manufactured+Beginning finished goods inventory-Cost of goods sold

= $40000+10000-33000= $17000

Case 3

Total conversion cost= Total current manufacturing costs-Direct materials used

= $31200-9300= $21900

Total conversion cost= Direct labor+Manufacturing overhead applied

Let Direct labor= X

Total conversion cost= X+150%*X

$21900= 2.5X

X= $8760

X= Direct labor= $8760

Manufacturing overhead applied= 150%*8760= $13140

Ending work in process inventory= Total current manufacturing costs+Beginning work in process inventory-Cost of goods manufactured

= $31200+8100-28001= $11299

Beginning finished goods inventory= Cost of goods sold+Ending finished goods inventory-Cost of goods manufactured

= $40000+6500-28001= $18499