Flow of manufacturing costs
The following data are taken from the accounting records of Ruiz Mfg. Co.:
<i> Please see attachment for table</i>
Compute the following amounts:
a) Direct materials purchased during the period.
e) The overhead application rate, assuming that overhead is applied to production as a percentage of direct labor costs.
<i> Please see attachment for all questions</i>
SOLUTION This solution is FREE courtesy of BrainMass!
a) Direct Materials Purchased during the year : End of Year Inv + End of Yr WIP + Direct materials used - Beg Inv - Beg WIP
=20,000+25,000 +20,000 - 17,000 - 18,000 = $30,000.
B)Total Mfg costs charged to production : Direct Materials + direct labour + overheads - ( change in materials Inv + change in WIP)
= 20000 +10000 +40,000 - ( 3000+7000) = $60,000
C)Cost of finished goods = Total manufacturing cost ; same as above.
d) Cost of goods sold = Total Manufacturing cost - change in finsihed goods Inv = 60,000 - 3000 = 57,000.
e)Overhead application rate = total overhead/labour = 40000/10000 = 4times. or 400%.© BrainMass Inc. brainmass.com December 24, 2021, 4:58 pm ad1c9bdddf>