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**Read each Liberty Company fact pattern carefully as the facts may vary*** Liberty Company is a manufacturer that uses job-order costing and disposes of
**Read each Liberty Company fact pattern carefully as the facts may vary*** Liberty Company is a manufacturer that uses job-order costing and disposes of over/under applied manufacturing overhead using the method covered in class. Liberty buys all raw materials on account from vendor, Justice Inc. Liberty provides the following information regarding its manufacturing operations for the twelve months ended 20X2: Budget Actual Raw Material Purchases $1,420,000 $1,400,000 Machine Hours 31,000 35,000 Direct Labor Hours 49,600 $2,000 $22 Direct Labor Rate $20 Manufacturing Overhead $620,000 $710,000 The following table summarizes Liberty's 12/31st account balances: 20X1 20X2 Raw Materials $189,000 $192,000 Work in Process $122,000 $110,680 Finished Goods $310,000 $294,000 Accounts Payable-Justice $44,000 $38,000 How much cash was paid to vendor Justice during 20X2 for purchases of raw materials? O $1,397,000 O $1,400,000 O $1,426,000 O $1,403,000 O $1,406,000
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