Answer:
Lock-Tite Company
1. Cost of direct materials used = $186,000
2. Cost of direct labor used = $265,000
3. Cost of goods manufactured = $ 625,400
4. Cost of goods sold = $652,800
4. Gross profit = $747,200
5. Underapplied overhead = $29,500
Explanation:
a) Data and Calculations:
Inventories April 30 May 31
Raw materials $43,000 $52,000
Work in process 10,200 21,300
Finished goods 63,000 35,600
Raw materials
Account Titles Debit Credit
Beginning balance $43,000
Cash 210,000
Factory overhead $15,000
Goods in Process 186,000
Ending balance $52,000
Goods in process
Account Titles Debit Credit
Beginning balance 10,200
Raw materials 186,000
Factory payroll 265,000
Factory overhead 185,500
Finished Goods Inventory 625,400
Ending balance 21,300
Factory Payroll
Account Titles Debit Credit
Cash $345,000
Factory Overhead $80,000
Goods in Process 265,000
Finished goods
Account Titles Debit Credit
Beginning balance 63,000
Goods in Process 625,400
Cost of goods sold 652,800
Ending balance 35,600
Factory Overhead
Account Titles Debit Credit
Raw materials $15,000
Factory payroll 80,000
Cash 120,000
Goods in Process $185,500
Balance 29,500
Income Statement (Partial)
Sales $1,400,000
Cost of goods sold 652,800
Gross profit $747,200
