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dit View History Bookmarks Window Help online.ewc.edu oodle Ariela Mendoza 1/LEC

ID: 2594531 • Letter: D

Question

dit View History Bookmarks Window Help online.ewc.edu oodle Ariela Mendoza 1/LEC/01-2017/FALL TRADITION es Of Accounting II s ACC 251/LEC/01-2017/FALLTRADITION/December 11 - December 17/Final Exam Heintz Company's job order costing system applies overhead based on direct labor costs. The company's manufacturing costs for the current year were: direct materials, $108,000; direct labor, $144,000; and factory overhead, $36,000. At year-end, the total cost of Work in Process is $38,000, which includes $12,000 of direct labor cost. What amount of direct material cost is included in the ending Work in Process inventory?

Explanation / Answer

Answer : $ 23,000.

Predetermined Overhead Rate = $ 36,000 / $ 144,000 = 0.25

At year end,

$ 38,000 = $ 12,000 x $ 12,000 x 0.25 + Direct Materials.

Direct Materials = $ 23,000.