PA2-8 (Algo) Recording Manufacturing Costs, Preparing a Cost of Goods Manufactured Report, and Calculating Income from Operations [LO 2-3, 2-4, 2-5, 2-6]

Dobson Manufacturing Company uses a job order cost system with manufacturing overhead applied to products on the basis of direct labor dollars. At the beginning of the most recent period, the company estimated its total direct labor cost to be $51,400 and its total manufacturing overhead cost to be $77,100. Several incomplete general ledger accounts show the transactions that occurred during the most recent accounting period which is given in second requirement. Required: 1. Calculate the predetermined overhead rate.

2. Fill in the missing values in the T-accounts.

3. Compute over- or underapplied overhead.

4. Prepare a statement of cost of goods manufactured and sold including the adjustment for over- or underapplied overhead.

5. Prepare a brief income statement for the company.

X Answer is not complete. Complete this question by entering your answers in the tabs below. Required Required Required Required Required 1 2 3 4 5 Fill in the missing values in the T-accounts. Raw Materials Inventory Beginning Balance 13,900 77,900 Purchases 93,800 Ending Balance 29,800 Work in Process Inventory Beginning Balance 28,600 179,250 Direct Materials 68,700 Direct Labor $ 40,500 Applied Overhead 60,750 Ending Balance 19,300 Cost of Goods Sold 171,550 Finished Goods Inventory Beginning Balance 41,200 171,550 Cost of Goods Completed 179,250 Ending Balance 48,900 Unadjusted Cost of Goods Sold Adjusted Cost of Goods Sold Sales Revenue 303,000 Manufacturing Overhead Indirect Materials 9,200 66,750X Applied Overhead Indirect Labor 14,900 Factory Depreciation 11,800 Factory Rent 6,400 Factory Utilities 2,200 Other Factory Costs 9,500 Actual Overhead 54,000 Selling, General, and Administrative Expenses Adm. Salaries 26,800 Office Depreciation 19,300 Advertising 13,500 Ending Balance 59,600 Required Required Required Required Required 1 2 3 4 5 Compute over- or underapplied overhead. Manufacturing Overhead Overapplied by $ 12,750X Required Required Required Required Required 1 2 3 4 5 Prepare a statement of cost of goods manufactured and sold including the adjustment for over- or underapplied overhead. DOBSON MANUFACTURING COMPANY Cost of Goods Manufactured and Sold Report Beginning Raw Materials Inventory $ 13,900 Plus: Raw Material Purchases 93,800 Less: Indirect Material Used 9,200 Less: Ending Raw Materials 29,800 Inventory Direct Materials Used in Production $68,700 Direct Labor 40,500 Manufacturing Overhead 66,750 $ 175,950 28,600 $ 204,550 19,300 Total Current Manufacturing Costs Plus: Beginning Work in Process Inventory Total Work in Process Less: Ending Work in Process Inventory Cost of Goods Manufactured Plus: Beginning Finished Goods Inventory Cost of Goods Available for Sale Less: Ending Finished Goods Inventory Unadjusted Cost of Goods Sold $ 179.250 41,200 $ 220,450 48,900 $ 171,550 Adjustment for Overapplied Overhead $ 12,750X Adjusted Cost of Goods Sold Required Required Required Required Required 1 2 3 4 5 Prepare a brief income statement for the company. DOBSON MANUFACTURING COMPANY Income Statement Sales Revenue $ 303,000 Cost of Goods Sold Gross Profit Selling, General, and Administrative Expenses Net Income from Operations