Question
Marvelous Marshmallow Companys cost of goods sold for January was $346,000. January 31 work-in-process inventory was 90 percent of January 1 work-in-process inventory. Manufacturing overhead
Marvelous Marshmallow Companys cost of goods sold for January was $346,000. January 31 work-in-process inventory was 90 percent of January 1 work-in-process inventory. Manufacturing overhead applied was 50 percent of direct-labor cost. Other information pertaining to the companys inventories and production for the month of January is as follows: Machining Department Assembly Department Budgeted manufacturing overhead $4,000,000 $3,136,000 Actual manufacturing overhead 4,270,000 3,040,000 Budgeted direct-labor cost (based on practical capacity) 1,500,000 5,600,000 Actual direct-labor cost 1,450,000 5,780,000 Budgeted machine hours (based on practical capacity) 400,000 100,000 Actual machine hours 425,000 110,000 The data that follow pertain to job no. DC66, the only job in production at year-end. Machining Department Assembly Department Direct material $24,500 $ 6,800 Direct labor $27,700 $58,600 Machine hours 370 150 Selling and administrative expense amounted to $2,500,000. Compute the cost of the companys year-end work-in-process inventory. Determine whether overhead was under- or overapplied during the year in the Machining Department. Determine whether overhead was under- or overapplied during the year in the Assembly Department.
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