# Solution for ch3 - EXERCISE 3-24(20 MINUTES 1 Raw-material...

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EXERCISE 3-24 (20 MINUTES) 1 . Raw-material inventory, January 1 ......................................... \$185,50 0 Add: Raw-material purchases ................................................ 273,400 Raw material available for use .............................................. \$458,90 0 Deduct: Raw-material inventory, January 31 ......................... 173,600 Raw material used in January ................................................ \$285,30 0 Direct labor ............................................................................ 410,000 Total prime costs incurred in January ..................................... \$695,30 0 2 . Total prime cost incurred in January ...................................... \$695,30 0 Applied manufacturing overhead (70% \$410,000) ............. 287,000 Total manufacturing cost for January ..................................... \$982,30 0 3 . Total manufacturing cost for January ..................................... \$ 982,300 Add: Work-in-process inventory, January 1 ............................ 321,700 Subtotal ................................................................................. \$1,304,0 00 Deduct: Work-in-process inventory, January 31 ..................... 342,500 Cost of goods manufactured .................................................. \$ 961,500 4 . Finished-goods inventory, January 1 ...................................... \$ 184,900 Add: Cost of goods manufactured ......................................... 961,500 Cost of goods available for sale ............................................. \$1,146,4 00 Deduct: Finished-goods inventory, January 31 ...................... 160,400
Cost of goods sold .................................................................. \$ 986,000 Since the company accumulates overapplied or underapplied overhead until the end of the year, no adjustment is made to cost of goods sold until December 31. 5 . Applied manufacturing overhead for January ........................ \$287,00 0 Actual manufacturing overhead incurred in January ............. 242,500 Overapplied overhead as of January 31 ................................. \$ 44,500