Question
Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the companys inventory balances were as follows: Raw materials $ 66,000 Work in
Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the companys inventory balances were as follows: Raw materials $ 66,000 Work in process $ 33,600 Finished goods $ 38,400 The company applies overhead cost to jobs on the basis of direct labor-hours. For the current year, the companys predetermined overhead rate of $13.50 per direct labor-hour was based on a cost formula that estimated $540,000 of total manufacturing overhead for an estimated activity level of 40,000 direct labor-hours. The following transactions were recorded for the year: Raw materials were purchased on account, $684,000. Raw materials use in production, $646,400. All of of the raw materials were used as direct materials. The following costs were accrued for employee services: direct labor, $490,000; indirect labor, $150,000; selling and administrative salaries, $319,000. Incurred various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods warehousing), $423,000. Incurred various manufacturing overhead costs (e.g., depreciation, insurance, and utilities), $390,000. Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on all jobs during the year. Jobs costing $1,623,300 to manufacture according to their job cost sheets were completed during the year. Jobs were sold on account to customers during the year for a total of $3,547,500. The jobs cost $1,633,300 to manufacture according to their job cost sheets. 5. What is the total manufacturing cost added to Work in Process during the year?
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