Bard Manufacturing uses a job order cost accounting system. During one month Bar

Question

Bard Manufacturing uses a job order cost accounting system. During one month Bard purchased $195,000 of raw materials on credit; issued materials to production of $208,000 of which $17,000 were indirect. Bard incurred a factory payroll of $152,000, paid in cash, of which $27,000 is classified as indirect labor. Bard uses a predetermined overhead application rate of 150% of direct labor cost. Bard's beginning and ending Goods in Process Inventory are $15,700 and $27,200 respectively. Compute the cost of product transferred to Finished Goods Inventory:

Explanation / Answer

Raw Material Purchased 195000 Material Issued Direct 191000 Indirect 17000 Labour Direct 125000 Indirect 27000 Overheads 187500 (125000*150%) Total 547500 Add: Opening 15700 Less: Closing -27200 Cost of production 536000

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