Reggi Vineyards produces a full line of varietal wines. The company, whose fisca
ID: 2423268 • Letter: R
Question
Reggi Vineyards produces a full line of varietal wines. The company, whose fiscal year begins on November 1, has just completed a record-breaking year. Its inventory account balances on October 31 of this year were Materials Inventory, 51,803,800; Work in Process Inventory, $2,764,500; and Finished Goods Inventor)', $1,883,200. At the beginning of the year, the inventory account balances were Materials Inventory, $2,156,200; Work in Process Inventory, $3,371,000; and Finished Goods Inventory, $1,596,400. During the fiscal year, the company's purchases of direct materials totaled $6,750,000. Direct labor hours totaled 142,500, and the average labor rate was $8.20 per hour. The following overhead costs were incurred during the year: deprecia-tlon-piant and equipment, $685,600; indirect labor, $207,300; property tax-plant and equipment, $94,200; plant maintenance, $83,700; small tools, $42,400; utilities, $96,500; and employee benefits, $76,100Explanation / Answer
Reggi vineyards
Statement of cost of goods manufactured as on October 31
Direct materials Beginning raw material inventory $2156200 Purchases $6750000 Less: Raw material ending inventory $1803800 Total direct materials used $7102400 Direct labor (142500*$8.20 per hour) $1168500 Factory overhead Depreciation - Plant & Equipment $685600 Indirect labor $207300 Property tax - Plant and epuipment $94200 Plant maintenance $83700 Small tools $42400 Utilities $96500 Employee benefits (Not included since not related to manufacturing) - Total factory overhead $1209700 Total manufacturing costs $9480600 Add: Beginning work in process inventory $3371000 Total cost of work in process inventory $12851600 Less: Ending work in process inventory $2764500 Total cost of goods manufactured $10087100