The Ryde and Rowe Inc. had the following account balances as of January 1: Direct Materials Inventory
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Question:
The Ryde and Rowe Inc. had the following account balances as of January 1: |
Direct Materials Inventory | $ | 8,700 | ||
Work in Process Inventory | 76,500 | |||
Finished Goods Inventory | 53,000 | |||
Manufacturing Overhead | 0 |
During the month of January, all of the following occurred: |
1. | Direct labor costs were $49,000 for 1,800 hours worked. |
2. | Direct materials costing $27,000 and indirect materials costing $4,500 were purchased. |
3. | Sales commissions of $17,000 were earned by the sales force. |
4. | $26,000 worth of direct materials were used in production. |
5. | Advertising costs of $6,300 were incurred. |
6. | Factory supervisors earned salaries of $10,255. |
7. | Indirect labor costs for the month were $3,000. |
8. | Monthly depreciation on factory equipment was $4,500. |
9. | Utilities expense of $5,699 was incurred in the factory. |
10. | Equipment with manufacturing costs of $69,000 were transferred to finished goods. |
11. | Monthly insurance costs for the factory were $4,200. |
12. | $5,000 in property taxes on the factory were incurred and paid. |
13. | Equipment with manufacturing costs of $92,495 were sold for $168,172. |
Instructions | |
a. | Assume If Ryde and Rowe assigns manufacturing overhead of $34,400, what will be the balances in the Direct Materials, Work in Process, and Finished Goods Inventory accounts at the end of January? |
b. | As of January 31, what will be the balance in the Manufacturing Overhead account after the application of the overhead from part a? |
c. | What was Ryde and Rowes operating income for January? |
Posted Date: