Reconstructing missing data. A huge windstorm struck the only manufacturing plant of Texas Equipment, Inc., just after midnight on December 1.

All the work-in-process inventory was destroyed, but a few records were salvaged from the wreckage and from the company's headquarters. The insurance company has stated that it will pay the cost of the lost inventory if adequate documentation can be supplied. The insurable value of work-in-process inventory consists of direct materials, direct labor, and applied overhead.

The following information about the plant appears on the financial statements at the company's headquarters. This information pertains to the October before the storm.

A count of the inventories on hand November 30 (just before the storm) showed:

The accounts payable clerk tells you that outstanding bills to materials suppliers totaled $50,100 as of the close of business on November 30 ( j ust before the storm hit)
and that cash payments of $37,900 were made to them during the month of November.
The payroll clerk informs you that the payroll costs last month for the manufacturing section were $82,400 of which $14,700 was indirect labor.
At the end of November, the following balances were available from the main office:

Among the fragments of paper that you found lying about, you learn that indirect materials requisitioned in November was $2,086. You also learn that the overhead during the month of November was overapplied by $ 1 .200.
Compute the cost of the work-in-process inventory lost in the disaster.

Transcribed Image Text:

Materials inventory (includes direct and indirect materials), October 31 Work in process inventory, October 31 $ 49,000 Finished goods inventory. October 31 Cost of goods sold through October 31 Accounts payable (materials suppliers) on October 31 Manufacturing overhead year to date through October 31 (actual) Payroll payable on October 31 Withholding and other payroll liabilities on October 31 Overhead applied year to date through October 31 86,200 32,000 348,600 21.600 184,900. -0- 9,700 179,600