Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

5 5 of 15 look rint rences Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company's inventory balances were

image text in transcribed

5 5 of 15 look rint rences Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company's inventory balances were as follows: Raw materials Work in process Finished goods $ 60,500 $ 20,800 $ 57,600 The company applies overhead cost to jobs using direct labor-hours. For this year, the company's predetermined overhead rate of $11.25 per direct labor-hour was based on a cost formula that estimated $450,000 of total manufacturing overhead for an estimated activity level of 40,000 direct labor-hours. The following transactions were recorded this year. a. Raw materials were purchased on account, $622,000. b. Raw materials used in production, $591,800. All of of the raw materials were used as direct materials. c. The following costs were accrued for employee services: direct labor, $400,000; indirect labor, $150,000; selling and administrative salaries, $280,000. d. Incurred various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods warehousing), $400,000. e. Incurred various manufacturing overhead costs (e.g., depreciation, insurance, and utilities), $300,000. f. Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on all jobs during the year. g. Jobs costing $1,360,750 to manufacture according to their job cost sheets were completed during the year. h. Jobs were sold on account to customers during the year for a total of $3,330,000. The jobs cost $1,370,750 to manufacture according to their job cost sheets. 15. What is the net operating income for this year?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles Of Cost Accounting

Authors: Edward J. Vanderbeck

15th Edition

978-0840037039, 0840037031

More Books

Students also viewed these Accounting questions