The Flow of Manufacturing Costs Through Perpetual Inventory Records
The following T accounts summarize the flow of manufacturing costs during the current year through the ledger accounts of Payback Corporation:
Work in Process Inventory
Beg. balance$ 18,000
Beg. balance$ 20,000
Ending balance$ 14,000
Finished Goods Inventory
Beg. balance$ 98,000
Ending balance$ 5,000
Ending balance$ 110,000
Cost of Goods Sold
From the data supplied above, indicate the following amounts. Some amounts are shown in the T accounts above; others require short computations. (Show all computations.)
Purchases during the year of direct materials.
The cost of direct materials used.
Direct labor payrolls paid during the year.
Direct labor costs assigned to production.
The overhead application rate in use throughout the year, assuming that overhead is applied as a percentage of direct labor costs.
Total manufacturing costs charged to the Work in Process Inventory account during the current year.
The cost of finished goods manufactured.
The cost of goods sold.
The total costs to be classified as inventory in the year-end balance sheet.
16-4Alternate Problems for use with Financial and Managerial Accounting, 12e
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