Sheree_JohnsonII_BUS340_Assignemnt3

# Predetermine overhead rate estimated overhead costs

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Determine the overhead rate used (based on direct material cost).  Predetermine overhead rate = estimated overhead costs/ estimated material cost 600,000/1,500,00 = 0.4% = 40% 2. Only one job remained in the goods in process inventory at December 31, 2008. Its direct  materials cost is \$30,000. How much direct labor cost and overhead cost are assigned to  it?

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Total cost of job in process (given) ....................................................... \$ 50,000 Less materials cost of job in process (given) ........................................ (30,000 ) Less overhead applied (30,000 x 40%) ................................................. (12,00 0 ) Direct labor cost .................................................................................... \$ 8,000 Exercise 19-3 Cost flows in a job order cost system
1. Cost of direct materials used Beginning raw materials inventory ...................................................................... \$ 43,000 Plus purchases ...................................................................................................... 210,000 Raw materials available ....................................................................................... 253,000 Less ending raw materials inventory .................................................................... (52,000 ) Total raw materials used ...................................................................................... 201,000 Less indirect materials used ................................................................................. (15,00 0) Cost of direct materials used ................................................................................ \$ 186,000 2. Cost of direct labor used Total factory payroll ............................................................................................. \$ 345,000 Less indirect labor ................................................................................................ (80,000 ) Cost of direct labor used ...................................................................................... \$ 265,000 3. Cost of goods manufactured Beginning goods in process inventory ................................................................. \$ 10,200 Plus direct materials ............................................................................................. 186,000 Plus direct labor .................................................................................................... 265,000 Plus overhead applied (70% of DLC) .................................................................. 185,500 Total cost of goods in process .............................................................................. 646,700 Less ending goods in process inventory ............................................................... (21,300 ) Cost of goods manufactured ................................................................................. \$ 625,400 4.

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