Chapter 3 Solutions, 3rd day Exercise 3-13 (15 minutes) 1. | Actual manufacturing overhead costs| | $? 48,000| | Manufacturing overhead applied: 10,000 MH ? $5 per MH| | 50,000| | Overapplied overhead cost| | $?? 2,000| | | | | 2. | Direct materials:| | | | Raw materials inventory, beginning| $? 8,000| | | Add: Purchases of raw materials| 32,000| | | Raw materials available for use| 40,000| | | Deduct: Raw materials inventory, ending| 7,000| | | Raw materials used in production| | $? 33,000| | Direct labor| | 40,000| | Manufacturing overhead cost applied to work in process| | 50,000| | Total manufacturing cost| | 123,000| Add: Work in process, beginning| | 6,000| | | | 129,000| | Deduct: Work in process, ending| | 7,500| | Cost of goods manufactured| | $121,500| | | | | Problem 3-24 (60 minutes) 1. a. b.
| Actual manufacturing overhead costs:| | | Insurance, factory| $ 7,000| | Depreciation of equipment| 18,000| | Indirect labor| 42,000| | Property taxes| 9,000| | Maintenance| 11,000| | Rent, building| 36,000| | Total actual costs| 123,000| | Applied manufacturing overhead costs: $80,000 ? 150%| 120,000| | Underapplied overhead| $ ? 3,000| | | | 2. Pacific Manufacturing CompanySchedule of Cost of Goods Manufactured| Direct materials:| | | Raw materials inventory, beginning| $ 21,000| | Add: Purchases of raw materials| 133,000| | Total raw materials available| 154,000| | Deduct: Raw materials inventory, ending| 16,000| | Raw materials used in production| | $138,000| Direct labor| | 80,000| Manufacturing overhead applied to work in process| | 120,000| Total manufacturing cost| | 338,000| Add: Work in process, beginning| | 44,000| | | 382,000| Deduct: Work in process, ending| | 40,000| Cost of goods manufactured| | $342,000| | | | Problem 3-24 (continued) 3. Unadjusted cost of goods sold:| | | Finished goods inventory, beginning| $ 68,000| | Add: Cost of goods manufactured| 342,000| | Cost of goods available for sale| 410,000| | Deduct: Finished goods inventory, ending| 60,000| | Unadjusted cost of goods sold| $350,000| | | | The underapplied overhead may be closed directly to Cost of Goods Sold or allocated among Work in Process, Finished Goods, and Cost of Goods Sold in proportion to the overhead applied during the year in the ending balance of each of these accounts. 4. | Direct materials| $ 3,200| | Direct labor| 4,200| | Overhead applied (150% ? 4,200)| 6,300| | Total manufacturing cost| $13,700| | | | $13,700 ? 140% = $19,180 price to customer.
5. The amount of overhead cost in Work in Process was: $8,000 direct labor cost ? 150% = $12,000 The amount of direct materials cost in Work in Process was: Total ending work in process| | $40,000| Deduct:| | | Direct labor| $? 8,000| | Manufacturing overhead| 12,000| 20,000| Direct materials| | $20,000| | | | The completed schedule of costs in Work in Process was: Direct materials| $20,000| Direct labor| 8,000| Manufacturing overhead| 12,000| Work in process inventory| $40,000| | |
