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Lerry Corporation had the following transactions during its first month of operations: a) Purchased raw materials on account, $65,000. b) Raw materials of $25,000
Lerry Corporation had the following transactions during its first month of operations: a) Purchased raw materials on account, $65,000. b) Raw materials of $25,000 were requisitioned to the factory. An analysis of the materials requisition slips indicated that $1,400 was classified as indirect materials. c) Factory labour costs incurred were $37,500 of which $32,000 pertained to factory wages and $5,500 pertained to employer payroll taxes. d) Time tickets indicated that $35,000 was direct labour and $2,500 was indirect labour. e) Overhead costs incurred on account were $57,000. f) Manufacturing overhead was applied at the rate of 150% of direct labour cost. g) Goods costing $17,000 are still incomplete at the end of the month; the other goods were completed and transferred to finished goods. h) Finished goods costing $54,000 to manufacture were sold on account for $108,000. i) Factory supplies (latex gloves, disposable breathing masks, paper towels) used during the month totalled $576. j) Monthly rent for the entire facility was $8,750 and paid in cash. Square footage for the factory was 80% of the building's total floor space.
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