110) Assume that the following events occurred at a division of Advanced Enterprises for the
current year.
(1) Purchased $450,000 in direct materials.
(2) Incurred direct labor costs of $260,000.
(3) Determined that manufacturing overhead was $410,000.
(4) Transferred 70% of the materials purchased to Work-in-Process Inventory.
(5) Completed work on 65% of the work in process. Costs assigned equally across all work–in–
process.
(6) The inventory accounts have no beginning balances.
Required:
Compute the following amounts in the Work-in-Process Inventory account:
(a) Transfers-in (TI).
(b) Transfers-out (TO).
(c) Ending balance (EB).
111) Determine the missing values from the table below:
Case (A) Case (B) Case (C) Case (D)
Beginning Balance (BB) $ 41,520 $ 24,100 $ 5,450
?
Ending Balance (EB) ? 22,400 11,370
$ 38,910
Transferred In (TI) 224,870 ? 84,400 189,460
Transferred Out (TO) 217,400 106,200 ?
193,610
112) Determine the missing values from the table below:
Case (A) Case (B) Case (C) Case (D)
Beginning Balance (BB) ? $ 25,760 $ 12,050
$ 11,450
Ending Balance (EB) $ 19,455 ? 21,200
5,370
Transferred In (TI) 199,460 214,870 ? 87,300
Transferred Out (TO) 193,610 217,400 131,200
?
113) Flynn and Morgan Refiners began business on July 1. The following operations data are
available for July and the one product the company produces:
Gallons
Beginning inventory -0-
Started in July 310,000
Ending work-in-process inventory (80% complete) 30,000
Cost incurred in July were:
Materials $ 250,000
Labor 52,000
Manufacturing overhead 154,000
All production at Flynn and Morgan is sold as it is produced (i.e., there are no finished goods
inventories).
Required:
(a) Compute cost of goods sold for July.
(b) What is the value of the work-in-process inventory on July 31?
114) Mason Industries restarted operations on September 1 after a 3-month shutdown. There
were no beginning inventories. The following operations data are available for September and
the one product the company refines:
Gallons
Beginning inventory -0-
Completed in September 450,000
Ending work-in-process inventory (70% complete) 15,000
Cost incurred in September were:
Materials $ 560,400
Labor 164,300
Manufacturing overhead 242,350
All production at Mason is sold immediately.
Required:
(a) Compute cost of goods sold for September.
(b) What is the value of the work-in-process inventory on September 30?
115) Hindsville produces a cleaning solvent. Production of 200,000 gallons was started in
February, 170,000 gallons were completed. Material costs were $138,220 for the month while
conversion costs were $116,380. There was no beginning work-in-process; the ending work-in–
process was 60% complete.
Required:
(a) What is the total cost of the product that was completed and transferred to finished goods?
(b) What is the value of the ending work-in-process?
116) Fender Magic produces a paint solvent. Production of 400,000 pounds was started in
February, 350,000 pounds were completed. Material costs were $260,130 for the month while
conversion costs were $312,620. There was no beginning work-in-process; the ending work-in–
process was 90% complete.
Required:
(a) What is the total cost of the product that was completed and transferred to finished goods?
(b) What is the value of the ending work-in-process?
117) EZ Set produces a quick setting concrete powder. Production of 15,000 tons was started in
September, 14,000 tons were completed. Material costs were $394,670 for the month while
conversion costs were $201,730. There was no beginning work-in-process; the ending work-in–
process was 20% complete.
Required:
(a) What is the total cost of the product that was completed and transferred to finished goods?
(b) What is the value of the ending work-in-process?
118) Fill in the missing items for the following inventories:
(A) (B) (C) (D) (E)
Beginning Bal. $ 68,000 $ 7,100 $ 100,000 ? $ 85,200
Ending Balance ? 6,200 110,000 134,400 74,400
Transferred in 64,000 ? 75,000 153,600 ?
Transferred out 76,000 22,000 ? 182,400 264,000
119) Fill in the missing items for the following inventories:
(A) (B) (C) (D) (E)
Beginning Bal. $ 85,000 $ 3,550 $ 780,000 $ 36,000
?
Ending Balance ? 3,210 640,000 $ 36,000
32,000
Transferred in 80,000 10,550 ? 75,000 64,000
Transferred Out 76,000 ? 1,400,000 ?
42,000
69
120) Assume that the following T-accounts represent data from the Morgensen Corporation’s
accounting records.
Required:
(a) Find the missing amounts represented by the letters a, b, c, d and e.
(b) Determine the company’s predetermined overhead rate, based on labor cost.
BB = Beginning Balance; EB = Ending Balance TO = Transferred Out
Cost of Goods Sold
39,750
Raw-Material Inventory
BB (a)
(1) 22,500 TO 15,750
EB 7,125
Finished Goods
BB 6,750
(c) (d)
EB 10,950
Work-in-Process Inventory
BB 4,500
Materials (b)
Labor 24,000
Overhead (e) 43,950
EB 12,300
Manufacturing Overhead
17,400 12,000
(1) Denotes materials purchased
121) Smooth Sailing Company experienced the following events during 2020:
(1) Purchased $1,800,000 of lumber and other materials for building boats.
(2) Incurred $200,000 for advertising.
(3) Paid $60,000 to have lumber transported to its factory.
(4) Had sales revenue of $6,000,000 during the year.
(5) Incurred $400,000 of general and administrative expenses.
(6) Took a periodic inventory at year-end and determined that material costing $400,000 was on
hand. The inventory at the beginning of the year was $200,000.
(7) All costs incurred were added to the appropriate accounts. All sales were on credit.
Required:
Solve for the following items in the company’s Raw Materials inventory account:
a) Transfers in (TI).
b) Beginning balance (BB).
c) Transfers out (TO).
d) Ending balance (EB).
122) Gentry Cabinetry produces two models of home shelving, the Basic and the Mega. Data on
operations and costs for November are:
Basic Mega Total
Machine hours 8,000 4,000 12,000
Direct labor hours 6,000 4,000 10,000
Units produced 1,000 250 1,250
Direct material costs $ 20,000 $ 7,500 $ 27,500
Direct labor costs 129,000 71,000 200,000
Manufacturing overhead costs 348,200
Total costs $ 575,700
Required:
Compute the predetermined overhead rate, assuming Gentry Cabinetry uses:
(a) Direct labor hours to allocate overhead costs.
(b) Direct labor costs to allocate overhead costs.
(c) Machine hours to allocate overhead costs.
(d) Compute the unit cost for each model using direct labor costs to allocate overhead.
123) Gentry Cabinetry produces two models of home shelving, the Basic and the Mega. Data on
operations and costs for November are:
Basic Mega Total
Machine hours 8,000 4,000 12,000
Direct labor hours 6,000 4,000 10,000
Units produced 1,000 250 1,250
Direct material costs $ 20,000 $ 7,500 $ 27,500
Direct labor costs 129,000 71,000 200,000
Manufacturing overhead costs 348,200
Total costs $ 575,700
Required:
Compute the unit cost for each model, assuming Gentry Cabinetry uses:
(a) Direct labor hours to allocate overhead costs.
(b) Direct labor costs to allocate overhead costs.
(c) Machine hours to allocate overhead costs.
124) Barton Carts produces two models of push carts, the Standard and the Deluxe. Data on
operations and costs for the month are:
Standard Deluxe Total
Machine hours 16,000 8,000 24,000
Direct labor hours 12,000 8,000 20,000
Units produced 4,000 1,000 5,000
Direct material costs $ 80,000 $ 30,000 $ 110,000
Direct labor costs 262,000 138,000 400,000
Manufacturing overhead costs 557,400
Total costs $ 1,067,400
Required:
Compute the total cost for each model, assuming Barton Carts uses:
(a) Direct labor hours to allocate overhead costs.
(b) Direct labor costs to allocate overhead costs.
(c) Machine hours to allocate overhead costs.
125) Misner Office Products produces three models of commercial shelving, the Basic, the
Advanced and the Superior. Data on operations and costs for the month are:
Basic Advanced Superior Total
Machine hours 8,000 6,000 4,000 18,000
Direct labor hours 6,000 6,000 4,000 16,000
Units produced 1,000 500 250 1,750
Direct material costs $ 20,000 $ 12,500 $ 7,500 $ 40,000
Direct labor costs 129,000 100,000 71,000 300,000
Manufacturing overhead costs
540,800
Total costs $ 880,800
Required:
Compute the predetermined overhead rate, assuming Misner Office Products uses:
(a) Direct labor hours to allocate overhead costs.
(b) Direct labor costs to allocate overhead costs.
(c) Machine hours to allocate overhead costs.
(d) Compute the unit cost for each model using direct labor costs to allocate overhead.
126) Misner Office Products produces three models of commercial shelving, the Basic, the
Advanced and the Superior. Data on operations and costs for the month are:
Basic Advanced Superior Total
Machine hours 8,000 6,000 4,000 18,000
Direct labor hours 6,000 6,000 4,000 16,000
Units produced 1,000 500 250 1,750
Direct material costs $ 20,000 $ 12,500 $ 7,500 $ 40,000
Direct labor costs 129,000 100,000 71,000 300,000
Manufacturing overhead costs
540,800
Total costs $ 880,800
Required:
Compute the unit cost for each model, assuming Misner Office Products uses:
(a) Direct labor hours to allocate overhead costs.
(b) Direct labor costs to allocate overhead costs.
(c) Machine hours to allocate overhead costs.
127) Pierce Carts produces three models of push carts, the Economy, the Standard, and the
Deluxe. Data on operations and costs for the month are:
Economy Standard Deluxe Total
Machine hours 8,000 16,000 8,000 32,000
Direct labor hours 4,000 12,000 8,000
24,000
Units produced 8,000 4,000 1,000 13,000
Direct material costs $ 100,000 $ 80,000 $ 30,000
$ 210,000
Direct labor costs 200,000 262,000 138,000 600,000
Manufacturing overhead costs
684,800
Total costs $ 1,494,800
Required:
Compute the total cost for each model, assuming Pierce Carts uses:
(a) Direct labor hours to allocate overhead costs.
(b) Direct labor costs to allocate overhead costs.
(c) Machine hours to allocate overhead costs.
77
128) The management of Marysville Corporation would like to investigate the possibility of
basing its predetermined overhead rate on activity at capacity rather than on the estimated
amount of activity for the year. The company’s controller has provided an example to illustrate
how this new system would work. In this example, the allocation base is machine-hours and the
estimated amount of the allocation base for the upcoming year is 48,000 machine-hours. In
addition, capacity is 53,000 machine-hours and the actual activity for the year is 47,700
machine-hours. All of the manufacturing overhead is fixed and is $1,144,800 per year. For
simplicity, it is assumed that this is the estimated manufacturing overhead for the year, as well as
the manufacturing overhead at capacity, and the actual amount of manufacturing overhead for
the year. Job J42O, which required 40 machine-hours, is one of the jobs worked on during the
year.
Required:
(a) Determine the predetermined overhead rate if the predetermined overhead rate is based on the
estimated amount of the allocation base.
(b) Determine how much overhead would be applied to Job J42O if the predetermined overhead
rate is based on the estimated amount of the allocation base.
(c) Determine the predetermined overhead rate if the predetermined overhead rate is based on the
amount of the allocation base at capacity.
(d) Determine how much overhead would be applied to Job J42O if the predetermined overhead
rate is based on the amount of the allocation base at capacity.
129) The management of Norbert Corporation would like to investigate the possibility of basing
its predetermined overhead rate on activity at capacity rather than on the estimated amount of
activity for the year. The company’s controller has provided an example to illustrate how this
new system would work. In this example, the allocation base is machine-hours and the estimated
amount of the allocation base for the upcoming year is 70,000 machine-hours. In addition,
capacity is 82,000 machine-hours and the actual activity for the year is 72,900 machine-hours.
All of the manufacturing overhead is fixed and is $4,132,800 per year. For simplicity, it is
assumed that this is the estimated manufacturing overhead for the year as well as the
manufacturing overhead at capacity and the actual amount of manufacturing overhead for the
year. Job O65A, which required 300 machine-hours, is one of the jobs worked on during the
year.
Required:
(a) Determine the predetermined overhead rate if the predetermined overhead rate is based on the
amount of the allocation base at capacity.
(b) Determine how much overhead would be applied to Job O65A if the predetermined overhead
rate is based on the amount of the allocation base at capacity.
80
130) Linger Products uses a two-stage allocation method to assign costs to its products. The
following information has been provided for March:
Product 1 Product 2 Total
Units 3,000 2,000 5,000
Machine hours 2,000 4,000 6,000
Direct labor hours 2,000 2,000 4,000
Direct materials $ 60,000 $ 60,000 $ 120,000
Direct labor 45,000 45,000 90,000
Manufacturing overhead
Utilities (machine related) $ 3,000
Supplies (labor related) 8,000
Training (labor related) 20,000
Supervision (labor related) 17,000
Machine depreciation (machine related) 24,000
Lease on factory (machine related) 33,000
Miscellaneous (labor related) 5,000
Total manufacturing overhead $ 110,000
Required:
(a) Allocate the manufacturing overhead to two cost pools: machine-related and labor-related.
(b) Compute the predetermined overhead rate for the two pools, using machine hours and direct
labor hours as the bases.
(c) Compute the total costs of production for each of the two products.