Saved Help Bunnell Corporation is a manufacturer that uses job-order costing On

Question

Saved Help Bunnell Corporation is a manufacturer that uses job-order costing On January 1, the company's inventory balances as follows Rau materials 63, 500 Work in process 32,000 Finished goods 36,000 basis of direct labor-hours. For the current year, the company's The company applies overhead cost to jobs on the predetermined overhead rate of $13.00 per direct labor-hour was based on a cost formula that estimated $520,000 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, $584,000 b. Raw materials use in production, $537600. All of of the raw materials were used as direct materials c The following costs were accrued for employee services: direct labo, S470000, indirect labor ssoooo selling and administrative salaries, $249,000 d Incurred various selling and administrative expenses (e g. advertising, sales travel costs, and finished goods warehousing) $464,000 e. Incurred various manufacturing overhead costs (e g. depreciation, insurance, and utilities), $370,000 t Manufacturing overhead cost was applied to production. The company actualy worked 41000 direct labor-hours on all jobs during the year g Jobs costing 51.478.700 to manufacture according to their job cost sheets were completed during the year Prev 13 T4 15 of 17 Next > irefox in a whle. De you want to clean it up for s fresh, lke-new experience? ând by the way, welcome back

Explanation / Answer

13) Applied overhead = 13*41000 = $533000

Actual overhead = 150000+370000 = $520000

Overapplied overhead = 533000-520000 = $13000

Adjusted cost of goods sold = 1488700-13000 = $1475700

14) Gross margin = 3367500-1475700 = $1891800

15) Net income = 1891800-249000-464000 = $1178800

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