Custom Automobile Restoration Shop (CARS) is a small shop dedicated to high-quality restorations of vintage cars. Although it will restore an outomobile that a customer already owns, usually the shop buys an oid vehicle, restores it and then sells it in a private party sale or at a classic-car auction. The shop has been in existence for 10 years. but for the sake of simplicity, assume it has no beginning inventories for 2021. Five automobile restoration projects were worked on during 2021. By the end of the year, four of these projects were complete and three of them had been sold. The following selected data are from CARS' 2021 budget. The following information relates to production events during 2021. - Raw materials were purchased for $207,500. - Materials used in production totaled $200,400;$15,200 of these were considered indirect materials costs. The remaining $185,200 of direct materials costs related to individual motorcycle jobs as follows. - Raw materials were purchased for $207,500. - Materiais used in production totaled $200,400:$15,200 of these were considered indirect materials costs. The remaining $185,200 of direct materials costs related to individual motorcycle jobs as follows. Labor costs incurred for production totaled $176,700. The workers are highly skilled craftsmen who require little supervision. Therefore, all of these costs were considered direct labor costs and related to individual jobs as follows. Paid factory rent of $29.000. Recorded depreciation on factory equipment of $12,500. Made $5,500 of payments to outside vendors for maintenance of factory equipment. Paid factory utilities costs of $4,100. Applied manufacturing overhead using a predetermined rate of $16.75 per machine hour. The 3,460 machine hours that were used elate to each job as follows. - Completed all jobs except Job 705 and transferred those projects to finished goods. - Sold three jobs for the following amounts: - Closed the Manufacturing Overhead account to transfer any overapplied or underapplied overhead to the Cost of Goods Sold account. Required a. Assume CARS had used direct labor hours (versus machine hours) as its cost driver. Compute its predetermined overhead rate. Note: Round your answer to 2 decimal places. b. Determine the ending balance in Raw Materials Inventory. c. Determine the ending balance in Finished Goods inventory. d. Determine the ending balance in Work in Process Inventory. e. Determine the costs of goods manufactured. f. Determine the amount of Cost of Goods Sold. 9. Determine the amount of gross margin that was earned on Jobs 701, 702, and 703 . h. Determine the amount of overapplied or underapplied overhead that existed at the end of the year. Note: For all requirements, round your intermediate calculations to 2 decimal places. Required a. Assume CARS had used direct labor hours (versus machine hours) as its cost driver. Compute its predetermined overhead Note: Round your answer to 2 decimal places. b. Determine the ending balance in Raw Materials Inventory. c. Determine the ending balance in Finished Goods Inventory. d. Determine the ending balance in Work in Process Inventory. e. Determine the costs of goods manufactured. f. Determine the amount of Cost of Goods Sold. 9. Determine the amount of gross margin that was earned on Jobs 701, 702, and 703. h. Determine the amount of overapplied or underapplied overhead that existed at the end of the year. Note: For all requirements, round your intermediate calculations to 2 decimal places
