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pashok25 [27]
2 years ago
12

Manufacturing uses normal costing for its​ job-costing system, which has two​ direct-cost categories​ (direct materials and dire

ct manufacturing​ labor) and one​ indirect-cost category​ (manufacturing overhead). The following information is obtained for:_____.
• Total manufacturing costs, $8,450,000 • Manufacturing overhead allocated, $3,750,000 (allocated at a rate of 250% of direct manufacturing labor costs) • Work-in-process inventory on January 1, 2017, $390,000 • Cost of finished goods manufactured, $8,020,000
Requirements:
1. Use information in the first two bullet points to calculate​ (a) direct manufacturing labor costs in and​ (b) cost of direct materials used in .
2. Calculate the ending​ work-in-process inventory on December​ 31, 2011.
Business
1 answer:
Anvisha [2.4K]2 years ago
3 0

Answer:

Results are below.

Explanation:

Giving the following information:

Total manufacturing costs, $8,450,000

Manufacturing overhead allocated, $3,750,000 (allocated at a rate of 250% of direct manufacturing labor costs)

Work-in-process inventory on January 1, 2017, $390,000

Cost of finished goods manufactured, $8,020,000

<u>First, we need to calculate the direct material and direct labor:</u>

Direct labor= Manufacturing overhead allocated/2.5

Direct labor=  3,375,000 / 2.5

Direct labor= $1,350,000

Total manufacturing costs= Direct material + direct labor + allocated overhead

8,450,000= Direct material + 1,350,000 + 3,375,000

Direct material= $3,725,000

<u>Finally, the ending work-in-process:</u>

cost of goods manufactured= beginning WIP + direct materials + direct labor + allocated manufacturing overhead - Ending WIP

8,020,000= 390,000 + 8,450,000 - Ending WIP

Ending WIP= $820,000

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Answer:

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Opening Inventory Of Materials                  $4,000

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Subtract: Closing Inventory of materials    <u>   ($2600)</u>

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