Question

Problem 4-28 Bramble, Inc. manufactures ergonomically designed computer furniture. Bramble uses a job order costing system. On November 30, the Work in Process Inventory consisted of the following jobs: Job No. CC723 CH291 PS812 Item Computer caddy Chair Printer stand Units 22,000 18,000 30,000 Accumulated Cost $1,000,000 435,000 274,000 $1,709,000 On November 30, Bramble's Raw Materials Inventory account totaled $668,000, and its Finished Goods Inventory totaled $3,496,400. Bramble applies manufacturing overhead on the basis of machine hours. The company's manufacturing overhead budget for the year totaled $4,650,000, and the company planned to use 930,000 machine hours during the year. Through the first eleven months of the year, the company used a total of 900,000 machine hours, total manufacturing overhead amounted to $4,284,500, and Cost of Goods Sold was $8,770,250. For the pursposes of this problem, ignore year-end disposition of over / under applied overhead. Bramble purchased $638,000 in raw materials in December and incurred the following costs for jobs in process that month: Job No. CC723 CH291 PS812 DS444 Materials Issued $171,000 $14,000 $223,000 $256,000 Machine Hours 13,000 4,800 21,100 18,000 Direct Labor Hours 13,100 3,700 17,300 15,600 Direct Labor Cost $123,400 $43,200 $222,500 $138,000 The following jobs were completed in December and transferred to the Finished Goods Inventory: Job No. CC723 CH291 DS444 Item Computer caddy Chair Desk Units 22,000 18,000 5,000

Answer 1

a.

	CC723	CH291	PS812	DS444
Beginning balances	1,000,000	435,000	274,000
Current month costs:
Materials	171000	14000	223000	256000
Direct Labor	123400	43200	222500	138000
Overhead cost [Machine hours *$5]	65000	24000	105500	90000
Total cost	1,359,400	516,200	825,000	484,000

* Manufacturing overhead rate = 4650000/930000 = $5

b. Total manufacturing cost for December = Direct materials + Direct labor + Manufacturing overheads = 664,000 +527,100 +284,500 = 1,475,600

c. Cost of goods manufactured for December = Total manufacturing cost for December + Beginning WIP - Closing WIP =1,475,600 +1,709,000 - 825,000 = 2,359,600

d.  Balance in work in process = 825,000

e. Cost of goods sold = 1,706,610

Finished goods = 653,010 + 3,496,400 = 4,149,410

	CC723	CH291	PS812	DS444	Total
Beginning balances	1,000,000	435,000	274,000		1,709,000
Current month costs:
Materials	171000	14000	223000	256000	664,000
Direct Labor	123400	43200	222500	138000	527,100
Overhead cost [Machine hours *$5]	65000	24000	105500	90000	284,500
Total cost	1,359,400	516,200	825,000	484,000	3,184,600
No of units produced	22000	18000		5000
Cost per unit	61.79	28.68		96.80	2,359,600

	CC723	CH291	PS812	DS444	Total
No of units sold	15000	12000		4500
Cost per unit	61.79	28.68	0	96.8
Cost of goods sold	926850	344160	0	435600	1706610

	CC723	CH291	PS812	DS444	Total
Balance units	7000	6000		500
Cost per unit	61.79	28.68	0	96.8
Cost of goods sold	432530	172080	0	48400	653010