Explore BrainMass

# Cost of goods manufactured/sold

This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

Jansen company has a job order costing system. The company applies manufacturing overhead to jobs using a predetermined overhead rate based on direct labor cost. The information below has been taken from the cost records of the Jansen company for the past year:

Direct materials use in production \$1250
Total manufacturing costs charged to production during the year \$6050
(includes direct materials, direct labor and applied factory
Manufacturing overhead applied \$2800
Selling and administrative expenses \$1000
Inventories:
Direct materials, January 1 \$130
Direct materials December 31 \$80
Work in process January 1 \$250
Work in process December 31 \$400
Finished good January 1 \$300
Finished goods December 31 \$200

a- Compute the cost of direct materials purchased during the year
b- Compute the predetermined overhead rate that was used during the past year
c- Compute the Cost of Goods manufactured for the past year
d- Compute the Cost of Goods Sold for the past year

© BrainMass Inc. brainmass.com October 1, 2020, 10:10 pm ad1c9bdddf

#### Solution Preview

a- Compute the cost of direct materials purchased during the year

Direct material used = Opening direct material inventory + Purchases - Ending Direct material inventory
1,250 = 130 + Purchases - 80
Cost of direct materials purchased = 1,250+80-130 = \$1,200

b- Compute the ...

#### Solution Summary

The solution explains how to calculate the amount of cost of goods manufactured and cost of goods sold.

\$2.19