Please figure out the problems on the following attachments. Please show your work unless otherwise instructed to on a separate spreadsheet. If you have any questions feel free to email me.
EXERCISE 3-24 (Job-Order Costing Basics)
Rexford Company manufactures finger splints for kids who get tendonitis from playing video games. The firm had
the following inventories at the beginning and end of the month of January.
Finished goods $162,500 $152,100
Work in process 305,500 326,300
Raw material 174,200 161,200
The following additional manufacturing data pertains to January operations.
Raw material purchased $248,300
Direct labor 390,000
Actual manufacturing overhead 227,500
Rexford Company applies manufacturing overhead at the rate of 70 percent of direct labor-labor cost. Any overapplied
or underapplied manufacturing overhead is accumulated until the end of the year.
Compute the following amounts (show your work)
3. What is the company's prime cost for January?
4. What is the company's total manufacturing cost for January?
5. What are the costs of goods manufactured for January?
6. What is the cost of goods sold for January?
7. What is the balance in the manufacturing overhead account on January 31? Please indicate if this a debit or credit balance?
EXERCISE 3-35 (Overapplied or Underapplied Overhead)
The following pertains to Paramus Metal Works for the year just ended.
Budgeted direct-labor cost: 77,000 hours at $17 per hour
Actual direct-labor cost: 79,000 hours at $18 per hour
Budgeted manufacturing overhead: $993,300
Actual manufacturing overhead:
Property taxes 19,000
Indirect labor 79,000
Supervisory salaries 210,000
Rental of space 295,000
Indirect material (see data below) 79,000
Beginning inventory, January 1 46,000
Purchases during the year 95,000
Ending Inventory, December 31 62,000
Answer the questions below (show your work):
8. What is the firms predetermined overhead rate?
9. What is the overapplied or underapplied overhead for the year?
The solution has two problems relating to Job Order Costing. The first one deals with calculation of various costs and the second one with overhead application.