Ryde and Rowe Inc. had the following account balances as of January 1. During th
ID: 2568109 • Letter: R
Question
Ryde and Rowe Inc. had the following account balances as of January 1.
During the month of January, all of the following occurred.
Direct labor costs were $47,000 for 1,800 hours worked.
Direct materials costing $27,000 and indirect materials costing $5,000 were purchased.
Sales commissions of $16,000 were earned by the sales force.
$23,000 worth of direct materials were used in production.
Advertising costs of $6,300 were incurred.
Factory supervisors earned salaries of $12,469.
Indirect labor costs for the month were $3,000.
Monthly depreciation on factory equipment was $4,500.
Utilities expense of $6,191 was incurred in the factory.
Equipment with manufacturing costs of $69,000 were transferred to finished goods.
Monthly insurance costs for the factory were $4,200.
$5,000 in property taxes on the factory were incurred and paid.
Equipment with manufacturing costs of $96,519 were sold for $175,489.
Required:
a. If Ryde and Rowe assigns manufacturing overhead of $34,400, what will be the balances in the Direct Materials, Work in Process, and Finished Goods Inventory accounts at the end of January?
b. As of January 31, what will be the balance in the Manufacturing Overhead account?
c. What was Ryde and Rowe’s operating income for January?
Direct Materials Inventory $ 8,700 Work in Process Inventory 76,500 Finished Goods Inventory 53,000 Manufacturing Overhead 0Explanation / Answer
a.
b.
c.
Answer summary
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Particulars Amount Direct materials inventory, Jan. 1 8,700 Direct materials purchased 27,000 Less: Direct materials used in production 23,000 Direct materials inventory, Jan. 31 12,700 Work in process inventory, Jan. 1 76,500 Direct materials used 23,000 Direct labor used 47,000 Manufacturing overhead assigned 34,400 Less: Finished goods transferred out 69,000 Work in process inventory, Jan. 31 111,900 Finished goods inventory, Jan. 1 53,000 Cost of finished goods transferred in 69,000 Less: Cost of goods sold 96,519 Finished Goods Inventory at the end of January 25,481Related Questions
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