Question

Selected T-accounts of Moore Company are given below for the just completed year: Bal. 1/1 Debits Bal. 12/31 Debits Manufacturing Overhead 216,000 Credits 485,000 Debits Bal. 1/1 Direct materials Direct labor Overhead Bal. 12/31 Raw Materials 20,000 Credits 130,000 30,000 Work in Process 25,000 Credits 95,000 165,000 231,000 ? Pinished Goods 45,000 Credits 2 67,500 Factory Wages Payable 195,000 Bal. 1/1 Credits Bal. 12/31 11,500 190,000 6,500 Cost of Goods Sold Bal. 1/1 Debits Bal. 12/31 2 Debits Required: 1. What was the cost of raw materials used in production during the year? 2. How much of the materials in (1) above consisted of indirect materials? 3. How much of the factory labor cost for the year consisted of indirect labor? 4. What was the cost of goods manufactured for the year? 5. What was the unadjusted cost of goods sold for the year? Do not include any underapplied or overapplied overhead in your answer. 6. If overhead is applied to production on the basis of direct labor cost, what predetermined overhead rate was in effect during the year? 7. Was manufacturing overhead underapplied or overapplied? By how much? 8. Compute the ending balance in Work in Process. Assume that this balance consists entirely of goods started during the year. If $9.250 of this balance is direct labor cost, how much of it is direct materials cost? Applied overhead cost? nmn

Answer 1

1)	cost of raw materials used in prodcution during the year
	20000+130000-30000
	120000	answer
2)	Indirect materials
	120000-95000
	25000	answer
3)	Indirect labor
	190000-165000
	25000	answer
4)	cost of goods manufactured
	485,000	answer
5)	unadjusted cost of goods sold
	45000+485000-67500
	462500	answer
6)	predetermined overhead rate
	231000/165000
	140%	Answer
7)	overhead over applied
	applied			231000
	actual overhead			216,000
	overhead over applied			15,000	answer
8)	Ending balance in work in process
	25000+95000+165000+231000-485000
	31000	answer
	direct labor cost				9,250
	overhead applied (9250*140%)				12950
	direct materials (balancing)				8,800	answer
	total				31,000