Question
1. Raw material inventory for Foster Inc. on Jan 1, 2017, and Dec 31, 2017, were $59,000 and $41,000 respectively. Raw material purchases during 2017
1. Raw material inventory for Foster Inc. on Jan 1, 2017, and Dec 31, 2017, were $59,000 and $41,000 respectively. Raw material purchases during 2017 equaled $142,000. Foster incurred $201,000 on direct labor costs during 2017. Foster applies manufacturing overhead based on direct labor costs and the POHR is equal to 1.00. Both beginning and ending inventory equal zero for Work-In-Progress Inventory, as well as Finished Goods inventory. Actual manufacturing overheads costs during 2017 totaled $209,000. Assume that foster adjusts over-or under-applied overhead to the cost of goods sold.
What is the reported COGS on the income statement?
2. Bob uses a predetermined overhead application rate of $8 per direct labor hour. A review of the company's accounting records for the year just ended discovered the following:
Underapplied manufacturing overhead: $8,200
Actual manufacturing overhead: $492,000
Budgeted labor hours: 60,000
What are Bob's actual labor hours worked?
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