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

Case A

Case B

Case C

Direct materials used $

(a) $93,400 $65,150 Direct labor 56,000 146,100

(h) Manufacturing overhead applied 44,800

(d)

(i) Total manufacturing costs 150,150

(e) 212,750 Work in process 1/1/17

(b) 16,800 18,800 Total cost of work in process 205,900

(f)

(j) Work in process 12/31/17

(c) 15,400

(k) Cost of goods manufactured 194,300

(g) 223,900

Explanation / Answer

Predetermined overhead rate=($44800/$56000)=80%*Direct labor cost

Direct material+Direct labor+Manufacturing overhead=Total manufacturing cost

Total manufacturing cost+Beginning WIP=Total cost of work in process

Total cost of work in process-Ending WIP=Cost of goods manufactured

Hence in case C:

Direct labor+Manufacturing overhead=(212750-65150)=$147600

Direct labor+0.8Direct labor=147600

Hence Direct labor=147600/1.8

=$82000

Hence manufacturing overhead=(82000*0.8)=$65600

Case A Case B Case C Direct materials used $49350 93400 65150 Direct labor 56000 146100 82000 Manufacturing overhead applied 44800 (146100*0.8)=$116880 $65600 Total manufacturing costs 150150 $356380 212750 Work in process 1/1/17 $55750 16800 18800 Total cost of work in process 205900 $373180 $231550 Work in process 12/31/17 $11600 15400 $7650 Cost of goods manufactured 194300 $357780 223900

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