Use the following to answer questions 44-46 The following partially completed T-

Question

Use the following to answer questions 44-46 The following partially completed T-accounts summarize the transactions of Belson Company for last year Raw Materials Beg Bal 20,000 17 Work in Process Beg Bal 60,000 13 29 Manufacturing Overhead 14 29,000 Cost of Goods Sold Accounts Payable 17,000 3,000 Finished Goods Beg Bal 60 Wages& Salaries Payable 5,000 31,000 Beg Bal Sales Salaries Ex 9,00 Accumulated ciation 80,000 14,000 Beg At the end of the year, the company closes out the balance in the Manufacturing Overhead account to Cost of Goods Sold. ending balance of Finished Goods is $13,000. The 44. The indirect labor cost is: A) $6,000. B) S13,000. C) $16,000. D) S31,000. (before adjustment for under- or over applied overhead) is: 45. The A) S61,000. B) $62,000. C) S63,000. D) S64,000. 46. The cost of A) $17,000. B) $13,000. C) $29,000. D) S30,000. to WIP

Explanation / Answer

44. The indirect labor cost is nothing but the amount of wages and salaries shared with Manufacturing overhead account. Therefore, indirect labor cost is $ 6,000. Option A is correct answer.

45. The cost of goods sold, when the ending finished goods inventory is $ 13,000 is $ 63,000 ( $ 16,000 + $ 60,000 - $ 13,000). Option C is correct option. The above calculation is before adjusting for under or over applied overhead.

46. The cost of manufacturing overhead charged to WIP is $ 29,000, as it is the applied overhead to the work in process and the difference would be transferred to Cost of Goods sold. Option C is correct option.

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