Required Information The following Information applies to the questions displaye

Question

Required Information The following Information applies to the questions displayed below Bunnell Corporation Is a manufacturer thet uses job-order costing. On January 1, the company's Inventory balances were as follows 40,000 Rav naterials Work in process18,000 Pinished gooda 35,000 The company applies overhead cost to jobs on the basis of direct labor-hours. For the current year, the company's predetermined overhead rate of $16.25 per direct labor-hour was based on a cost formula that estimated $650,000 of total manufacturing overhead for an estimated activity level of 40,000 direct labor-hours. The following transactions were recorded for the year a. Raw materials were purchased on account, $510,000. b. Raw materials use in production, $480,000. All of of the rew materials were used as direct materials c. The following costs were accrued for employee services: direct labor, $600,000; Indirect labor, $150,000, seling ansd administrative salaries, $240,000. d. Incurred various selling and administrative expenses (e.g. advertising, sales travel costs, and finished goods warehousing), $367,000 e. Incurred various manufacturing overhead costs (e.g, depreciation, Insurance, and utilities), $500,000. t Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on all jobs during the year g. Jobs costing $1,680,000 to manufacture according to their job cost sheets were completed during the year h. Jobs were sold on account to customers during the year for a ingtheOOOO to total of $2,800,000. The jobs cost manufacture according to their job cost sheets. 13. Assuming that the goods sold for the year? company closes its underapplied or overapplied overhead to Cost of Goods Sold, what is the adjusted cost o MacBook Air 20 F7 FA

Explanation / Answer

13) Adjusted cost of goods sold 1,673,750 (1,690,000-16,250) 14) Gross margin 1,126,250 (sales - adjusted cost of goods sold) 15) Net operating income 519,250 answer Gross margin 1,126,250 less Selling & adm salaries -240,000 Various selling & adm -367,000 Net operating income 519,250

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