Question

Carlberg Co.’s March 31 inventory of raw materials is $105,000. Raw materials purchases in April are $590,000, and factory payroll cost in April is $428,000. Overhead costs incurred in April are: indirect materials, $90,000; indirect labor, $38,000; factory rent, $70,000; factory utilities, $29,000; and factory equipment depreciation, $56,000. The predetermined overhead rate is 70% of direct labor cost. Job 306 is sold for $760,000 cash in April. Costs of the three jobs worked on in April follow. Job 306 Job 307 Job 308 Balances on March 31 Direct materials $ 39,000 $ 50,000 Direct labor 30,000 23,000 Applied overhead 21,000 16,100 Costs during April Direct materials 145,000 235,000 $ 110,000 Direct labor 105,000 175,000 110,000 Applied overhead ? ? ? Status on April 30 Finished (sold) Finished (unsold) In process

Answer 1

Job 306 is Cost of Goods Sold 403,500

Job 307 is Finished Goods Inventory 621,600

Job 308 Is Goods Still in Process 287,000

Step-by-step explanation:

Carlberg Co.

Cost of Goods Manufactured

For the Month of April

Opening Inventory Raw Materials $105,000

Purchases Raw Materials $ 590,000

Less Ending Inventory $ 205,000

Direct Materials Used 490,000 (145,000+235,000 + $ 110,000 )

Direct Labor 390,000 (105,000+ 175,000 + 110,000)

Applied Overhead (70% of DL) 273,000

Total Manufacturing Costs $ 1153,000

Add Work in Process Mar 31 169,100

Cost of Goods Available For Manufacture 1322,100

Less Work in Process April 30 287,000

Cost of Goods Manufactured $1035,100

We add the balances to get the required figures and then find out the cost of goods manufactured.

31 March Balances

Job 306 Job 307 Job 308

Direct materials $ 39,000 $ 50,000 ----

Direct labor 30,000 23,000 -----

Applied overhead 21,000 16,100 -----

Beginning WIP 80,000 89,100

Costs during April

Direct materials 145,000 235,000 $ 110,000

Direct labor 105,000 175,000 110,000

Applied overhead 73,500 122,500 77,000

Costs Added In April 323,500 532,500 287,000

Total Costs 403,500 621,600 287,000

Status On April 30 Finished Finished In Process

(sold) (unsold)

Cost Of Goods Finished Goods Goods In Process

Sold Inventory

Job 306 is Cost of Goods Sold

Job 307 is Finished Goods Inventory

Job 308 Is Goods Still in Process