The company uses normal costing and manufacturing overhead is applied at the rate of 150% of direct labour cost. Over or under-applied manufacturing overhead is closed on an annual basis to the cost of goods sold and this has been included in the above data.

Required:

(a) Interpret the relationship between the cost figures above to determine the missing amounts in each of the divisions shown above. (24 marks)

(b) Calculate the amounts to be charged to work in process, finished goods inventory and cost of goods sold for the Aero Engines Division at the end of 30 June 2020 if the proration method is used. Provide your final answer to the nearest dollar. (4 marks)

(c) Prepare the necessary journal entries for (b) to describe the flow of costs. (2 marks)

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