The Flow of Manufacturing Costs A Comprehensive Problem
The balances in the perpetual inventory accounts of Valleyview Manufacturing Corporation at the beginning and end of the current year are as follows:
| Beginning of Year | |
Inventory accounts: |
|
|
Materials | $15,000 | $25,000 |
Work in Process | 10,000 | 8,000 |
Finished Goods Inventory | 24,000 | 30,000 |
Total dollar amounts debited and credited during the year to the accounts used in recording manufacturing activities are as follows:
| Debit Entries | Credit Entries |
Account: |
|
|
Materials Inventory | $225,000 | $ ? |
Direct Labor | 200,000 | 210,000 |
Manufacturing Overhead | 420,000 | 420,000 |
Work in Process Inventory | ? | ? |
Finished Goods Inventory | ? | ? |
Instructions
a. Using these data, state or compute for the year the following amounts:
1. Direct materials purchased.
2. Direct materials used.
3. Payments of direct labor payrolls.
4. Direct labor cost assigned to production.
5. The overhead assigned to production stated as a percentage of direct labor costs.
6. Total manufacturing costs charged to the Work in Process Inventory account during the year.
7. The cost of finished goods manufactured.
8. The cost of goods sold.,
9. The total amount to be classified as inventory in the year-end balance sheet.
b. Prepare a schedule of the cost of finished goods manufactured.
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