Partial operating data for Merton Company are presented below. Management has se
ID: 2434544 • Letter: P
Question
Partial operating data for Merton Company are presented below. Management has set the predetermined overhead rate for the current year at 120 percent of direct labor costs.ACCOUNT/TRANSACTION June July
Beginning materials inventory a e
Beginning work in process inventory $89,605 f
Beginning finished goods inventory 79,764 $67,660
Direct materials requested 59,025 g
Materials purchased 57,100 60,216
Direct labor costs 48,760 54,540
Overhead applied b h
Cost of units completed c 231,861
Cost of goods sold 166,805 i
Ending materials inventory 32,014 27,628
Ending work in process inventory d j
Ending finished goods inventory 67,660 30,515
Using T accounts and the data provided, compute the unknown values. Show all you computations.
Explanation / Answer
a. Beginning material inventory Materials applied+ Materials at the end-Materials purchased 59025+32014×-57100= $33,939 b. Overheads applied 120% of labor cost 48760×120/100= $58,512 c. Cost of units manufactured Cost of goods sold+closing finished goods-opening stock of finished goods 166805+67660-79764 154701 d. Closing work in progress Total overhead cot-Cost of goods manufactured Opening work in progress 89605 Direct materials 59025 Direct labor 48760 Over heads 58512 255902 Cost of goods manufactured 154701 Closing work in progress 101201 e. Raw materials at the end of june is the opening raw 32014 materials of july f.Ending work in progress of june is the opening work in progressof july 101201 g. Raw materials at the beginning 32014 Raw materials purchased 60216 92230 Less: Raw materials at the end 27268 Raw materials requested 64602 h. Overheads applied is 120%of direct labor 54540×120% 65448 i. Cost of goods sold for july Beginning finished goods inventory 67660 Add: cost of goods manufactured 231861 299521 Less: Ending finished goodsiinventory 30515 Cost of goods sold for july 269006 j. Ending work in progress inventory Total manufactured overheads-cost of goods manufactured Opening work in progress 101201 Direct materials 64602 Direct labor 54540 Overheads 65448 285891 Less: cost of goods manufctured 231861 Beginning material inventory 64030