Question

Billy Baroo Company uses a job order cost system. The following information was found in the Work-in-Process account for the month of July.
Date Description Amount [DR. or (CR.)]
July 1 Balance $13,500
July 31 Direct labor 41,000
July 31 Direct materials 58,000
July 31 Factory overhead 32,800
July 31 Transfer to finished goods (86,000 )

Billy Baroo applies overhead to production at a predetermined rate of 80% based on the direct labor cost. Job #23, the lyjob still inprocessattheendofJuly, has been chargedwith direct aboro $12,000 Direct material charged to Job#23 was:_________

Answer 1

Answer:

$37,700

Explanation:

Ending balance in WIP = 13,500 + 41,000 + 58,000 + 32,800 - 86,000

Ending balance in WIP = $59,300

Direct material charged to Job #23 = $59,300 - $12,000 - ($12,000*80%)

Direct material charged to Job #23 = $59,300 - $12,000 - $9,600

Direct material charged to Job #23 = $37,700