Exercise 15-4 Manufacturing cost data for Orlando Company, which uses a job orde

Question

Exercise 15-4 Manufacturing cost data for Orlando Company, which uses a job order cost system, are presented below Indicate the missing amount for each letter. Assume that in all cases manufacturing overhead is applied on the basis of direct labor cost and the rate is the same. (Round overhead rate to 2 decimal places, e.g. 15.25 and final answers to 0 decimal places, e.g 5,275.) Case A Case B Case C Direct materials used $89,500 $65,450 60,000 45,000 146,650 Direct labor 142,400 Manufacturing overhead applied Total manufacturing costs Work in process 1/1/17 Total cost of work in process Work in process 12/31/17 Cost of goods manufactured 215,950 16,100 18,600 208,000 0) 16,900 193,500 230,200

Explanation / Answer

Solution :- Case A

(a). Direct material used = 146650 - (60000 + 45000)

= 146650 - 105000

= $ 41650.

(b). Work in process 1/1/17 = 208000 - 146650

= $ 61350.

(c). Work in process 12/31/17 = 208000 - 193500

= $ 14500.

Case B

(d). Manufacturing overhead applied = 142400 * 45000 / 60000

= 142400 * 0.75

= $ 106800.

(e). Total manufacturing costs = 89500 + 142400 + 106800

= $ 338700.

(f). Total cost of work in progress = Total manufacturing costs + Work in process 1/1/17

= 338700 + 16100

= $ 354800.

(g). Cost of goods manufactured = Total cost of work in progress - Work in process 12/31/17

= 354800 - 16900

= $ 337900.

Conclusion :-

(a) $ 41650 (b) $ 61350 (c) $ 14500 (d) $ 106800 (e) $ 338700 (f) $ 354800 (g) $ 337900

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