Table 2 - Raw Materials - Opening Balances Account Inventory Account Physical Quantity (sheets) Average Cost (per sheet) Total Value Scrap Rate (1-3%)

15000 10' x 32' Sheet Metal 1317 $112.00 $147,504.00 1%

15001 6' x 5' Sheet Metal 535 $16.00 $8,560.00

15002 6' x 6' Sheet Metal 288 $20.00 $5,760.00

15003 4' x 16' Sheet Metal 789 $30.00 $23,670.00

Scrap 791 sq.ft

Table 3 - Fabricating Department - Annual Overhead Budget

Total Production 12,332,661 sq feet

Rent $257,339

Depreciation $162,468

Indirect Labour $182,197

Indirect Materials $94,778

During the month, the following events occurred in the Fabricating Department:

1. On the first of the month, the company purchased on account 2073 sheets of 10 x 32 sheet metal at a cost of $100 per sheet.

2. On the fifteenth of the month, the company purchased on account an additional 1372 sheets of 10 x 32 sheet metal at a cost of $115 per sheet.

3. Throughout the month, 4068 sheets were moved from raw materials and put into production. 31 of these sheets were damaged at some point in the production phase and were completely scrapped. Overhead was applied using a predetermined overhead rate.

4. At the end of the month, all scrap on hand, including beginning scrap and the scrap created during the month, was sold on account for $0.07 per square foot.

5. Depreciation of the Fabricating Departments machinery and equipment was $14682 for the month.

6. Indirect labour and benefits for the Fabricating Department amounted to $16763 for the month. Both will be paid on the first of the following month.

7. Production labor and benefits for the Fabricating Department, its only direct labor costs, amounted to $112296 for the month. These will also be paid on the first of the following month.

8. Indirect materials including primer and treatment chemicals were purchased on account in the amount of $9675 and were completely used in production.

9. Rent for the Fabricating Departments facility was $20768 for the month. This rent was prepaid at the end of the prior month.

10. Payables totaling $43525, the prior months accrued direct labor cost of $104634, the prior months accrued indirect labor cost of $19543, and the next months rent of $19569 were all paid with cash during the month.

11. All work in process inventory was completed and transferred to the three departmental finished goods accounts, 6 x 5 Sheet Metal Inventory, 6 x 6 Sheet Metal Inventory, 4 x 16 Sheet Metal Inventory, before month end.

12. 3765 sheets of 6 x 6 finished metal were sold on account to an external buyer at a price of $21 per sheet. Cost of sales is accounted for using a weighted average method.

13. Receivables totaling $69810 were collected.

D. For each of the three final products (the 6 x 5, 6 x 6, and 4 x 16 metal sheets), allocate the costs incurred from Requirement C using the physical measures method, based on square feet. Break the allocations into a cost per sheet.
		4 x 16	6 x 6	6 x 5	Total
Sq feet per sheet
Number of Sheets
Sq feet produced
Allocation percentage
Alllocated costs
Cost per Sheet