HWCh.3 - Exercise31(10minutes a b c d e f g h i j k l...

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Exercise 3-1  (10 minutes) a. Job-order costing b. Job-order costing c. Process costing d. Job-order costing e. Process costing* f. Process costing* g. Job-order costing h. Job-order costing i. Job-order costing j. Job-order costing k. Process costing l. Process costing *Some of the listed companies might use either a process costing or  a job-order costing system, depending on the nature of their  operations and how homogeneous the final product is. For  example, a plywood manufacturer might use job-order costing if it  has a number of different plywood products that are constructed of  different woods or come in markedly different sizes. Problem 3-16  (45 minutes) 1. The actual manufacturing overhead costs incurred were as  follows: Reference (a) Indirect materials. ...................................... $  38,000 (b) Indirect labor. ............................................ 27,000 (c) Factory heat, power, and water. ................ 42,000 (d) Factory insurance. ..................................... 9,000 (f) Factory depreciation. .................................       51,000     Total manufacturing overhead incurred. .... $167,000 In contrast, $170,000 in manufacturing overhead cost was applied  to jobs: $153,000 =$4.25 per MH; 40,000 MHs×$4.25 per MH=$170,000. 36,000 MHs
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Manufacturing overhead incurred. .......... $167,000 Manufacturing overhead applied (40,000 MHs × $4.25 per MH). ............   170,000     Overhead overapplied. ........................... $        3,000     2. The cost of goods sold for the year (before adjustment for  underapplied or overapplied overhead) is $475,000—the total cost  to manufacture the goods that were sold according to their job cost  sheets. The adjusted cost of goods sold is computed as follows: Unadjusted cost of goods sold. ...................... $475,000 Deduct: Overapplied overhead. ..................... 3,000 Cost of goods sold. ........................................ $472,000 The selling and administrative expenses for the year were: Reference (b) Sales commissions. .................................. $  36,000 (b) Administrative salaries. ............................. 80,000 (d) Insurance. ................................................. 1,000 (e) Advertising. ............................................... 50,000 (f) Depreciation. .............................................           9,000     Total selling and administrative expense. . $176,000 Ravsten Company Income Statement For the Year Ended December 31 Sales. ...................................................... $700,000 Cost of goods sold. .................................   472,000     Gross margin. ......................................... 228,000 Selling and administrative expense. ........  
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This note was uploaded on 03/26/2010 for the course MBA ma506 taught by Professor Salamy during the Spring '10 term at A.T. Still University.

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HWCh.3 - Exercise31(10minutes a b c d e f g h i j k l...

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