The following account balances at the beginning of January were selected from th
ID: 2391615 • Letter: T
Question
The following account balances at the beginning of January were selected from the general ledger of Ocean City Manufacturing? Company: Work in process inventory ?$0 Raw materials inventory $ 28 comma 900 Finished goods inventory $ 41 comma 000
Additional? data:
1. Actual manufacturing overhead for January amounted to $ 64 comma 400$64,400. 2. Total direct labor cost for January was $ 63 comma 800$63,800. 3. The predetermined manufacturing overhead rate is based on direct labor cost. The budget for the year called for $ 250 comma 000$250,000 of direct labor cost and $ 350 comma 000$350,000 of manufacturing overhead costs. 4. The only job unfinished on January 31 was Job No.? 151, for which total direct labor charges were $ 6 comma 000$6,000 ?(1 comma 4001,400 direct labor? hours) and total direct material charges were $ 14 comma 900$14,900. 5. Cost of direct materials placed in production during January totaled $ 123 comma 900$123,900. There were no indirect material requisitions during January. 6. January 31 balance in raw materials inventory was $ 35 comma 500$35,500. 7. Finished goods inventory balance on January 31 was $ 35 comma 500$35,500.Explanation / Answer
Work in process inventory balance on January 31: $29300.
Working:
Predetermined manufacturing overhead rate = $350000/$250000 = 140% of direct labor cost.
Work in process (Job No. 151) Direct materials 14900 Direct labor 6000 Manufacturing overhead ($6000 x 140%) 8400 Work in process on January 31 $ 29300