Selected T-accounts of Moore Company are given below for the just completed year:
|Work in Process|
|Factory Wages Payable|
|Cost of Goods Sold|
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 $10,500 of this balance is direct labor cost, how much of it is direct materials cost? Applied overhead cost?
1) Raw material used = 25000+140000-35000 = 130000
2) Indirect material = 130000-100000 = 30000
3) Indirect labor = 200000-180000 = 20000
4) Cost of goods manufactured = 500000
5) Unadjusted cost of goods sold = 50000+500000-75000 = 475000
6) Overhead rate = 223200/180000 = 124% of labor cost
7) Applied overhead = 223200
Actual overhead = 203200
Over applied overhead = 20000
8) Ending work in process = 33200
Direct material = 33200-10500-13020 = 9680
Applied overhead = 10500*1.24 = 13020
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