acct6111 fall 2013 assignment 2 case 3 muscat company product cost flows 495990

ACCT6111 Fall 2013 Assignment 2

Case 3: Product Cost Flows

Selected T-accounts for Muscat Company are given below for the just completed year:

Raw Materials Manufacturing Overhead

Bal. 1/1 30,000 Credits Debits 385,000 Credits

Debits 420,000____________

Bal, 12/31 60,000

Work in Process Factory Wages Payable

Bal. 1/1 70,000 Credits 810.000 Debits 179,000 Bal, 1/1 10,000

Direct materials 320,000 Credits 175,000

Direct labor 110.000 Bal.12/31 6,000

Overhead 400,000________________

Bal. 12/31

Finished Goods Cost of Goods Sold

Bal. 1/1 40.000 Credits Debits

Debits________________________

Bal, 12/31 130.000

Required:

1. What was the cost of raw materials put into production during the year?

2. How much of the materials in (1) above consisted of indirect materials?

3. How much of the factory labor cost for the year consisted of indirect labor?

4. What was the cost of goods manufactured for the year?

5. What was the cost of goods sold for the year (before considering under-applied or over-applied overhead)?

6. If overhead is -applied to production on the basis of direct materials cost, what rate was in effect during the year?

7. Was manufacturing overhead under-applied or over-applied? By how much?

8. Compute the ending balance in the Work in Process inventory account. Assume that this balance consists entirely of goods started during the year. If $32,000 of this balance is direct materials cost, how much of it is direct labor cost? Manufacturing overhead cost?