Use the information below to answer the following two questions: fe, Inc. began

ID: 2343242 • Letter: U

Question

Use the information below to answer the following two questions: fe, Inc. began operations in March and uses job order costing with Manufacturing Overhead (MOH) aspplied to produdiun at a predetermined overhead rate of 150% of Direct Labor Cost. Below is selected information related to the first 3 months: Job #101 Job #102 Job #103 Started in: March April April Completed in: April April May April $ 26,000 $ 20,000 $29,325 March Direct Material used in production 4,400 Actual Direct Labor Cost incurred $2,200 Actual MOH Cost incurred $ 3,450 16 If as of April 30, Job #103 had incurred $2,800 in actual Direct Material and $1,000 in actual Direct Labor, Cost of Goods Manufactured (COGM) for the month of April was: 78,600 78,075 76,000 75,325 None of the above D. $ E. 17 At the end of each month, Radcliffe closed out its over-Junder-applied MOH entirely to Cost of Goods Sold (COGS). At the end of April, the affect of this entry would be a: 525 decrease to unadjusted Net Operating Income 675 decrease to unadjusted Net Operating Income 525 Increase to unadjusted Net Operating Income 675 increase to unadjusted Net Operating Income C. $ D. $ E. None of the above Page 12 of 14

Explanation / Answer

Job 101

Job 102

Job 103

Job Started

March

Job Completed

April

Status on April End

Finished

WIP

16) Ans:

Cost Of Goods Manufactured

Particulars

Computation

Amount

Direct Material

$4400+$26,000

$30,400

Direct Labor

$220 +$20,000

$22,200

Overheads

$22,200*150%

$33,300

Total cost from March to April

$85900

Cost Incurred in work in

process Job-103

Material

($2800)

Labour

($1800)

Overheads

1800*150%

($2700)

Total

($7300)

Cost of Goods Manufactured

(A-B)

$78,600

17.Ans

c) $525 Increase to Unadjusted Net operating Income

Actual direct labor cost

2200

20000

Predetermined overhead rate

150%

Manufacturing overheads applied

3300

30000

33300

Actual manufacturing overheads

3450

29325

32775

(Under applied) / overapplied

-150

675

525

Journal entry is

Manufacturing overheads 525

Cost of goods sold 525