Question

Can someone help me determine how to complete this question I am very confused

Conundrum Corporation manufactures furniture. Due to a fire in the administrative offices, the accounting records for November of the current year were partially destroyed. You have been able to piece together the following information from the ledger. Raw-Material Inventory 40,000 Bal. 11/30 45,000 Accounts Payable 12,100 Bal. 10/31 Work-in-Process Inventory Bal. 10/31 8,000 Finished-Goods Inventory Bal. 10/31 35,000 Manufacturing Overhead 60,000 Cost of Goods Sold Wages Payable 1,600 Bal 11/30 Sales Revenue Accounts Receivable Bal. 10/31 8,000
( the last photo is required part 2)

Answer 1

Solution:

1.	Sales revenue for November	$217,200
2.	November 30 balance in accounts receivable	$20,100
3.	Cost of raw materials purchased during November	$69,900
4.	November 30 balance in work in process inventory	$38,100
5.	Direct labor added to work in process during November	$80,100
6.	Applied overhead for November	$60,075
7.	Cost of goods completed during November	$150,000
8.	Raw materials used during November	$40,000
9.	October 31 balance in raw materials inventory	$15,100
10.	Overapplied or under applied overhead for November	$0

First we calculate, predetermined overhead rate:

Predetermined overhead rate = $720,000 / 48,000 hours ($96,0000 /$20)

= $15 per direct labor hour

A.)

1.)Sales revenue = $181,000 × 120% = $217,200

2.)

November 30 balance in accounts receivable = Beginning balance + sales - Cash collections

= $8,000 + $217,200 - $205,100 = $20,100

3.)

Cost of raw materials purchased = Ending accounts payable balance + Cash payments - Beginning accounts payable balance

= $1,000 + $81,000 - $12,100

= $69,900

4.)

November 30 balance in work in process inventory = $20,600 + 500 × $20 + 500 × $15

= $20,600 + $10,000 + $7,500

= $38,100

5.)

Direct labor added = Ending wages payable balance + Payments made - Beginning wages payable balance

= $1,600 + $79,500 - $-$1,000

= $80,100

6.)

Applied overhead = Direct labor hours × Predetermined overhead rate

= ($80,100/ $20 per hour) 4,005 hours × $15

= $60,075

7.)

Cost of goods completed = Beginning work in process + Total manufacturing cost - Ending work in process

* Total manufacturing cost = Direct materials + Direct labor + Applied overhead

Total manufacturing cost = $40,000 + $80,100 + $60,000 = $180,100

Cost of goods completed = $$8000 + $180,100 - $38,100 = $150,000

8.)

Raw materials used = $40,000

9.)

October 31 balance in raw materials inventory = Raw materials used + Ending balance - raw materials purchases

= $40,000 + $45,000 - $69,900

= $15,100

10.)

Over or under applied overhead = Applied overhead - Actual overhead

= $60,000 - $60,000

= $0

B.)

	Raw materials inventory					Accounts payable
Bal. 10/31	$15,100						$12,100	Bal. 10/31
Accounts payable	$69,900	$40,000	Work in process		Cash	$81,000	$69,900	Raw materials inventory
Bal.11/30	$45,000						$1,000	Bal.11/30
	Work in process inventory					Finished goods inventory
Bal. 10/31	$8,000				Bal. 10/31	$35,000
Direct materials	$40,000	$150,000	Cost of goods completed		Work in process	$150,000	181,000	Cost of goods sold
Direct labor	$80,100
Applied overhead	$60,000				Bal. 11/30	$4,000
Bal. 11/30	$38,100
	Manufacturing overhead					Cost of goods sold
Actual	$60,000	$60,000	Work in process		Finished goods	$181,000
Bal. 11/30	$0
	Wages payable					Sales revenue
		$1000	Bal.10/31				$217,200	Accounts Receivable
Cash	$79,500	$80,100	Work in process
		$1,600	Bal.11/30
	Accounts receivable
Bal. 10/31	$8,000
Sales	$217,200	$205,100	Cash
Bal. 11/30	$20,100

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