Question
Show complete solution. For numbers 1,2,5 A . The following data from the just completed year are taken from the accounting records of Mason Company:
Show complete solution. For numbers 1,2,5
A. The following data from the just completed year are taken from the accounting records of Mason Company:
Sales $ 524,000
Direct labor cost $ 70,000
Raw material purchases $ 118,000
Selling expenses $ 140,000
Administrative expenses $ 63,000
Manufacturing overhead applied to work in process $ 90,000
Actual manufacturing overhead costs $ 80,000
Inventories Beginning Ending
Raw materials $ 7,000 $ 15,000
Work in process $ 10,000 $ 5,000
Finished goods $ 20,000 $ 35,000
Complete the following...
1. Prepare a schedule of cost of goods manufactured. Assume all raw materials used in production were direct materials.
2. Prepare a schedule of cost of goods sold. Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold.
3. Prepare an income statement.
B. Yancey Productions is a film studio that uses a job-order costing system. The company's direct materials consist of items such as costumes and props. Its direct labor includes each film's actors, directors, and extras. The company's overhead costs include items such as utilities, depreciation of equipment, senior management salaries, and wages of maintenance workers. Yancey applies its overhead cost to films based on direct labor-dollars.
At the beginning of the year, Yancey made the following estimates:
Direct labor-dollars to support all productions $8,000,000
Fixed overhead cost $4,800,000
Variable overhead cost per direct labor-dollar $0.05
Complete the following:
1. Compute the predetermined overhead rate.
During the year, Yancey produced a film titled You Can Say That Again that incurred the following costs:
Direct materials $ 1,259,000
Direct labor cost $ 2,400,000
For number 2, compute the following:
2.
Direct materials=_______
Direct labor=_________
Overhead applied=_____________
Total job cost=____________
C. Wilmington Company has two manufacturing departmentsAssembly and Fabrication. It considers all of its manufacturing overhead costs to be fixed costs. The first set of data that is shown below is based on estimates from the beginning of the year. The second set of data relates to one particular job completed during the yearJob Bravo.
Estimated Data Assembly Fabrication Total
Manufacturing overhead costs $ 600,000 $ 800,000 $ 1,400,000
Direct labor-hours 50,000 30,000 80,000
Machine-hours 20,000 100,000 120,000
Job Bravo Assembly Fabrication Total
Direct labor-hours 11 3 14
Machine-hours 3 6 9
Required:
1. If Wilmington used a plantwide predetermined overhead rate based on direct labor-hours, how much manufacturing overhead would be applied to Job Bravo?
2. If Wilmington uses departmental predetermined overhead rates with direct labor-hours as the allocation base in Assembly and machine-hours as the allocation base in Fabrication, how much manufacturing overhead would be applied to Job Bravo?
For number two, place answers on the blanks provided:
I. Plantwide manufacturing overhead applied to Job Bravo=____________
II. Manufacturing overhead applied from Assembly to Job Bravo=____________
III. Manufacturing overhead applied from Fabrication to Job Bravo=____________
IV. Total departmental manufacturing overhead applied to Job Bravo=_____________
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