Question No 3:

On March , 1, the company has the following inventories : materials 10,000, work in process 20,000 and finished goods 29,000. During the month the cost of goods sold is 250,000. Purchase returned 5,000. Direct labor for March was 40,000 and FOH was 100% of direct labor. Inventories on March 31 were as follows materials 15,000; WIP 8,000 and finished goods 29,000.

Requirements

Prime cost

Conversion cost

Cost of goods manufactured

Purchases

Under applied or over applied FOH. (Actual FOH for the month was 42,000 (10 marks)

NOTE: Question is required alongside the roughwork