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Marcelino Co.'s March 31 inventory of raw materials is $85,000. Raw materials purchases in April are $580,000, and factory payroll cost in April is $382,000. Overhead costs incurred in April are: indirect materials, $54,000; indirect labor, $25,000; factory rent, $34,000; factory utilities, $24,000; and factory equipment depreciation, $54,000. The predetermined overhead rate is 50% of direct labor cost. Job 306 is sold for $665,000 cash in April. Costs of the three jobs worked on in April follow.

	Job 306				Job 307				Job 308
Balances on March 31
Direct materials		$	28,000			$	40,000
Direct labor			21,000				16,000
Applied overhead			10,500				8,000
Costs during April
Direct materials			131,000				210,000			$	110,000
Direct labor			104,000				153,000				100,000
Applied overhead			?				?				?
Status on April 30	Finished (sold)				Finished (unsold)					In process

4.1 Compute gross profit for April.

Gross Profit	$

4.2 Show how to present the inventories on the April 30 balance sheet.

Inventories
Raw materials
Work in process
Finished goods
Total inventories	$

Answer 1

	Job 306	Job 307	Job 308	April Total
From March
Direct Materials	$28,000	$40,000		$68,000
Direct Labor	21,000	16,000		$37,000
Applied overhead	10,500	8,000		$18,500
Beginning goods in process	$59,500	$64,000	$0	$123,500
For April
Direct Materials	131,000	210,000	110,000	$451,000
Direct Labor	104,000	153,000	100,000	$357,000
Applied overhead	52,000	76,500	50,000	$178,500
Total costs added in April	$287,000	$439,500	$260,000	$986,500
Total costs (April 30)	$346,500	$503,500	$260,000	$1,110,000
Status on April 30	Finished (sold)	Finished (unsold)	In process
April 30 cost included in:	Cost of goods sold	Finished goods inventory	Goods in process inventory
4.1
Sales	665000
Cost of goods sold	$346,500
Gross Profit	$318,500
4.2
Inventories
Raw materials	214000	=85000+580000-451000
Work in process	$260,000
Finished goods	$503,500
Total inventories	977500