Cost of Goods Manufactred Direct Materials: Beginning raw materials inventory Add: Purchases of raw materials Raw materials

available for use Deduct : Ending raw materials inventory Raw materials used in production Deduct: Indirect materials included in manufacturing overhead Direct labor Manufacturing overhead Applied to Work in Process Total manufacturing costs Add : Beginning work in process inventory Deduct : Ending work in process inventory Cost of goods manufactured

21,000 145,000 166,000 16,000 150,000 0

150,000 224,000 225,000 599,000 25,000 624,000 67,000 557,000

Cost of Goods Sold Beginning finished goods inventory Add : Cost of goods manufactured Goods available for sale Deduct : Ending finished goods inventory Unadjusted Cost of Goods Sold Add: Underapplied overhead Adjusted Cost of goods sold Income Statement Sales Cost of goods sold Gross Margin/ Loss Selling and Admin Expenses Salaries expenses Depreciation Expense Advertising Expense Other Expenses Net Operating Income/Loss 1,000,000 533,800 466,200 30,000 7,000 42,000 8,000 39,000 557,000 596,000 66,000 530,000 3,800 533,800

310,000 156,200

Direct materials Direct Labor (Labor Hours * Per hour cost) MOH (150% of direct Materials) Total Cost

3,700 4,400 5,550 13,650

Price per Unit(570) units Price sold (70% markup)

####### 40.71

Raw Materials 21,000 145,000

Direct Materials

underapplied or overapplied overhead Actual Direct Labor Hours Predeterminded Overhead Rate Manufacturing Over Applied Less Manufacturing overhead incurred Manufacturing Overhead overapplied 8230 22.3 183529 175400 8129

7,400 17,500 41,300 8,200 10,500 35,600 120,500

84,100 95033 -25467