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    The income statement shows sales of $643,000 with a gross margin of $173,000 after deducting cost of goods sold of $470,000. Net operating income is $30,000 after accounting for selling, rent, and administrative expenses. The cost of goods sold schedule shows that the beginning finished goods was $70,000 and cost of goods manufactured was $415,000 for a total cost of goods available of $485,000. With ending finished goods of $25,000, the adjusted cost of goods sold is $470,000. The cost of goods manufactured schedule shows that direct materials cost $130,000, direct labor cost $90,000, and manufacturing overhead applied was $210,000

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    The income statement shows sales of $643,000 with a gross margin of $173,000 after deducting cost of goods sold of $470,000. Net operating income is $30,000 after accounting for selling, rent, and administrative expenses. The cost of goods sold schedule shows that the beginning finished goods was $70,000 and cost of goods manufactured was $415,000 for a total cost of goods available of $485,000. With ending finished goods of $25,000, the adjusted cost of goods sold is $470,000. The cost of goods manufactured schedule shows that direct materials cost $130,000, direct labor cost $90,000, and manufacturing overhead applied was $210,000

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    5 views4 pages

    ch3 Managerial

    Uploaded by

    tam tam
    The income statement shows sales of $643,000 with a gross margin of $173,000 after deducting cost of goods sold of $470,000. Net operating income is $30,000 after accounting for selling, rent, and administrative expenses. The cost of goods sold schedule shows that the beginning finished goods was $70,000 and cost of goods manufactured was $415,000 for a total cost of goods available of $485,000. With ending finished goods of $25,000, the adjusted cost of goods sold is $470,000. The cost of goods manufactured schedule shows that direct materials cost $130,000, direct labor cost $90,000, and manufacturing overhead applied was $210,000

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    of 4

    3- Income statement

    Sales 643000
    -Cost of goods sold -470,000
    Gross margin (Contribution margin ) 173000
    -selling expense -100,000
    -Rent expense 0
    -adminstrative expense -43000
    Net operating income 30,000
    2-Prepare a schedule of cost of goods sold
    Finished goods beginning 70,000
    +cost of goods manufactured 415000
    Total cost of goods available for sale 485000
    -Finished goods ending -25000
    Unadjusted cost of goods sold 460,000
    + underapplied overhead manufacturing 10,000
    Or
    -overapplied overhead manufacturing
    Adjusted cost of goods sold 470,000

    1-Prepare a scheduler of cost of goods manufactured


    Direct material
    Raw material beginning 8000
    + Raw material purchases +132000
    Total cost of raw material available 140,000
    -raw material ending -10,000
    Raw material used in production 130,000
    -indirect material zero
    Total cost of direct material 130,000
    + Direct labor 90,000
    + Manufacturing overhead applied 210,000
    Total manufacturing cost 430,000
    + work in process beginning 5000
    -work in process ending -20,000
    Cost of good manufactured 415000

    Actual manufacturing overhead 1000 ‫ التكاليف اللي صرفتها فعال في الواقع‬QR


    Manufacturing overhead applied 800 ‫ التكاليف اللي توقعتها‬QR

    If actual MOH greater than MOH applied it’s meaning underapplied overhead (+
    If actual less than MOH applied it’s meaning overapplied overhead (–)

    Westan Corporation uses a predetermined overhead rate of $23.10 per


    direct labor-hour. This predetermined rate was based on a cost formula that
    estimated $277,200 of total manufacturing overhead for an estimated
    activity level of 12,000 direct labor-hours.
    The company incurred actual total manufacturing overhead costs of
    $266,000 and 12,600 total direct labor-hours during the period.
    Required:
    Determine the amount of manufacturing overhead that would have been

    applied to all jobs during


    Manufacturing overhead applied = predetermined overhead rate x actual

    direct labor hours

    Manufacturing overhead applied= 23.10 x 12,600 = 291,060 QR

    Actual MOH = 266000 QR

    Explain if the MOH underapplied or overapplied

    Answer: it’s overapplied by 25060

    If actual MOH greater than MOH applied it’s meaning underapplied overhead (+
    If actual less than MOH applied it’s meaning overapplied overhead (–)

    Predetermined overhead rate= Total manufacturing overhead estimated


    Estimated direct labor hours

    Predetermined overhead rate = 277,200 / 12000 = 23.10

    actual overhead rate= Total manufacturing overhead actual


    actual direct labor hours

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