Finlon Upholstery, Inc uses a job order costing system to accumulate manufacturing costs The companys work in process on December 31, 20x1, consisted of one job (no 2077), which was carried on the year end balance sheet at $156,800 There was no finished goods inventory on this date Finlon applies manufacturing overhead to production on the basis of direct labor cost (The budgeted direct labor cost is the companys practical capacity, in terms of direct labor hours, multiplied by the budgeted direct labor rate ) Budgeted totals for 20x2 for direct labor and manufacturing overhead are $4,200,000 and $5,544,000, respectively Actual results for the year follow Direct material used $ 5,550,000 Direct labor 4,350,000 Indirect material used 65,000 Indirect labor 2,860,000 Factory depreciation 1,740,000 Factory insurance 58,000 Factory utilities 830,000 Selling and administrative expenses 2,160,000 Total $ 17,613,000 Job no 2077 was completed in January 20x2 there was no work in process at year end All jobs produced during 20x2 were sold with the exception of job no 2143, which contained direct material costs of $154,000 and direct labor charges of $85,000 The company charges any under or overapplied overhead to Cost of Goods Sold Required 1 Determine the companys predetermined overhead application rate 2 Determine the additions to the Work in Process Inventory account for direct material used, direct labor, and manufacturing overhead 3 Compute the amount that the company would disclose as finished goods inventory on the December 31, 20x2, balance sheet 4 Prepare the journal entry needed to record the years completed production 5 a Compute the amount of under or overapplied overhead at year end 6 Determine the companys 20x2 cost of goods sold Finished goods inventory, Jan 1 Cost of goods available for sale Unadjusted cost of goods sold Cost of goods sold 7 Would it be appropriate to include selling and administrative expenses in either manufacturing overhead or cost of goods sold

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Finlon Upholstery, Inc  uses a job order costing system to accumulate manufacturing costs  The companys work in process on December 31, 20x1, consisted of one job (no  2077), which was carried on the year end balance sheet at $156,800  There was no finished goods inventory on this date  Finlon applies manufacturing overhead to production on the basis of direct labor cost  (The budgeted direct labor cost is the companys practical capacity, in terms of direct labor hours, multiplied by the budgeted direct labor rate ) Budgeted totals for 20x2 for direct labor and manufacturing overhead are $4,200,000 and $5,544,000, respectively  Actual results for the year follow  Direct material used $ 5,550,000 Direct labor 4,350,000 Indirect material used 65,000 Indirect labor 2,860,000 Factory depreciation 1,740,000 Factory insurance 58,000 Factory utilities 830,000 Selling and administrative expenses 2,160,000 Total $ 17,613,000 Job no  2077 was completed in January 20x2  there was no work in process at year end  All jobs produced during 20x2 were sold with the exception of job no  2143, which contained direct material costs of $154,000 and direct labor charges of $85,000  The company charges any under  or overapplied overhead to Cost of Goods Sold  Required  1  Determine the companys predetermined overhead application rate  2  Determine the additions to the Work in Process Inventory account for direct material used, direct labor, and manufacturing overhead  3  Compute the amount that the company would disclose as finished goods inventory on the December 31, 20x2, balance sheet  4  Prepare the journal entry needed to record the years completed production  5 a  Compute the amount of under  or overapplied overhead at year end 6  Determine the companys 20x2 cost of goods sold  Finished goods inventory, Jan  1 Cost of goods available for sale Unadjusted cost of goods sold Cost of goods sold 7  Would it be appropriate to include selling and administrative expenses in either manufacturing overhead or cost of goods sold

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Finlon Upholstery, Inc. uses a job-order costing system to accumulate manufacturing costs. The companys work-in-process on December 31, 20x1, consisted of one job (no. 2077),

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Direct material used	$	5,550,000
Direct labor		4,350,000
Indirect material used		65,000
Indirect labor		2,860,000
Factory depreciation		1,740,000
Factory insurance		58,000
Factory utilities		830,000
Selling and administrative expenses		2,160,000
Total	$	17,613,000