Question

Shen Company reports the costs incurred below for the month ended May 31. The company has no beginning Work in Process Inventory. Overhead is applied using a predetermined overhead rate of 125% of direct materials costs. Job 4 was completed and Job 5 is still in process at month-end. Prepare a schedule of cost of goods manufactured for the month.

| | Job 4 | Job 5 |
| Direct material used | $2.800 | $2.200 |
| Direct labor used | 3.400 | 3.30 |

Answer 1

To prepare a schedule of cost of goods manufactured, we calculate the total manufacturing cost using direct material, direct labor, and overhead cost. Using the provided information, we can determine the cost of goods manufactured for the month of May is $17,950.

Step-by-step explanation:

In order to prepare a schedule of cost of goods manufactured, we need to determine the total manufacturing cost for the month. This includes the direct material used, direct labor used, and overhead cost. To calculate the overhead cost, we multiply the direct material cost by the predetermined overhead rate of 125%. Let's calculate the cost of goods manufactured for the month using the information provided:

Job Direct Material Used Direct Labor Used Overhead Cost Job 4$2,800$3,400$3,500Job 5$2,200$3,300$2,750.

The total cost of goods manufactured for the month is the sum of direct material, direct labor, and overhead cost for each job:

Total Cost of Goods Manufactured = Direct Material + Direct Labor + Overhead Cost

Total Cost of Goods Manufactured = ($2,800 + $3,400 + $3,500) + ($2,200 + $3,300 + $2,750)

Total Cost of Goods Manufactured = $9,700 + $8,250

Total Cost of Goods Manufactured for the month = $17,950