Answer:
1.- first question D. Beginning WIP: $8,500
2.- second question A raw materials used. $63,000
3.- third quesion B. $21,700 actual overhead
Explanation:
Balance in May 1st
4,000 direct materials
300 hours x $9 labor rate = 2,700
300 hours x $6 overhead rate = 1,800
Total 8,500
We have to calculate the total cost for materials added for the month
beginning + purchase - used into production = ending
We are given the fact that balance decrease by 3,000 so
ending - beginning = -3,000
we post that into the formula:
purchase - used into production = ending - beginning
60,000 - production = -3,000
production = 63,000
applied overhead:
3,200 hours x 6 = 19,200
If underapplied by 2,500 then:
applied - actual = -2,500
so
19,200 - actual = -2,500
19,200 + 2500 = actual
actual overhead = 21,700
