Baxter Company developed the following data for the current year:
Beginning work in process inventory
Direct materials used
Cost of goods manufactured
Total manufacturing costs
Baxter Company's direct labor cost for the year is ???
How do I manipulate and what formulas do I manipulate to get the missing Direct Labor total and Manufacturing Overhead total, of which Direct Materials (90,000) is given as well as the Total Manuf Costs total is given (450,000)
How do I get Predetermined overhead rate, and how and when do I use the Overhead Applied amount given??
My comments and cost flow chart is attached.
Thank you for asking ...
Solution is three pages, showing the T accounts and cost flows and then populating the T accounts with the data given to show visually how the missing amount can be derived. 689 words in everyday language suitable for a novice.
An additional comment was added to explain how to solve when you only have DM and OH.