l Winfrey Co.\'s March 31 inventory of raw materials is $170,000. Raw materials
ID: 2372186 • Letter: L
Question
l Winfrey Co.'s March 31 inventory of raw materials is $170,000. Raw materials purchases in April are $420,000, and factory payroll cost in April is $204,000. Overhead costs incurred in April are: indirect materials, $23,000; indirect labor, $15,000; factory rent, $20,000; factory utilities, $13,000; and factory equipment depreciation, $17,250. The predetermined overhead rate is 45% of direct labor cost. Job 306 is sold for $320,000 cash in April. Costs of the three jobs worked on in April follow
Determined the total of each production cost incurred in April( direct labor, direct materials, and applied materials, and applied overhead) and the total cost assigned to each job including the balances from March 31
Explanation / Answer
Direct labor cost is essentially the work related expenses that can be attributed to the actual manufacturing of a product/good. In case of service industry, direct labor cost is referred to the labor cost needed for providing a particular service. Thus, direct labor cost does not involve employees who are not involved in the production, like office and administrative staff members. It only consists of personnel who are responsible for setting up as well as maintaining the equipment In the direct labor cost we need to have the job time and wage we will pay it to the worker to can calculate the direct labor cost as in this formulation:[1]- ..................................................................... Use the following information on Spann Company for this question Beginning Direct Materials Inventory - $115,654 Ending Direct Materials Inventory - $134,762 Total purchases of direct materials during the period - $554,002 The total Cost of Direct Materials Used during the period is......................................... 115654 beginning inventory +554002 purchased direct material =669656 - 134762 ending inventory +534894 total cost of direct materials
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