Question

Bonita Company produces high quality microscopes for education and health care uses. The company uses a job order costing system. Because the microscopes' optics require significant manual labor to ensure adherence to strict manufacturing specifications, the company applies Overhead on the basis of direct labor hours. At the beginning of 2017, the company estimated its manufacturing overhead would be $1.970,000 and that employees would work a total of 49,250 direct labor hours. During March, the company worked on the following five jobs: Job 134 158 Direct Materials Direct Labor Direct Labor Hours Beginning added during added during added during Balance March March March $118,500 $3,000 $3,200 121,400 2,700 12,120 390 21,800 86,400 36,400 3.440 34,400 71,700 31.820 2.680 18,900 21,895 $295,100 $182,700 $110,435 8.110 212 287 301 Jobs 134 and 158 were started in January, Jobs 212 and 287 were started in February, and Job 301 was started in March. During March, workers completed Jobs 134, 158, and 212 Jobs 134 and 212 were delivered to customers during March Actual overhead for the month of March was $176,000. The manufacturing overhead account is disposed of annually not monthly

1. calculate the cost of goods manufactured for march

2. calculate the balance in the work in progress inventory account as of march 31.

3. calculate the cost of goods sold for march.

4. calculate the balance in the finished goods inventory account as of march 31.

Answer 1

Basic calculations: Estimated manufacturing overhead cost Estimated direct labor hours (DLHs) Predetermined overhead rate per DLH $1,970,000 49,250 $40 ($1970000 / 49250 DLHs] (b) OH Rate $40 $40 Job 134 158 212 287 301 Totals (a) DLHS 140 390 3,440 2,680 1,460 8,110 (p) = (a) (b) OH cost $5,600 $15,600 $137,600 $107,200 $58,400 $324,400 (q) DM cost $3,000 $2,700 $86,400 $71,700 $18,900 $182,700 (0) DL cost $8,200 $12,120 $36,400 $31,820 $21,895 $110,435 (p)+(q)+(1) March cost $16,800 $30,420 $260,400 $210,720 $99,195 $617,535 $40 $40 $40 --> Total mfg. costs for March Job 134 158 (u) + (v) Total cost $135,300 $151,820 $282,200 $245,120 $99,195 $913,635 (u) (v) Beg. Bal. March cost --> As calculated in Part 2 $118,500 $16,800 $121,400 $30,420 $21,800 $260,400 $34,400 $210,720 $0 $99,195 $296,100 $617,535 212 287 301 Totals

1) Cost of goods manufactured for March = Cost of jobs completed in March (Job 134, Job 158 & Job 212) Job Total cost 134 $135,300 158 $151,820 212 $282,200 Totals $569,320 --> Cost of goods manufactured for March 2) Cost of work in process as of March 31 = Cost of jobs not completed in March (Job 287 & Job 301) Job Total cost 287 $245,120 301 $99,195 Totals $344,315 --> Cost of ending work in process as of March 31 3) Cost of goods sold for March = Cost of jobs completed and sold in March (Job 134 & Job 212) Job 134 212 Totals Total cost $135,300 $282,200 $417,500 --> Cost of goods sold for March 4) Cost of finished goods as of March 31 = Cost of jobs completed but not sold in March (Job 158) Job 158 Total cost $151,820 --> Cost of ending finished goods as of March 31