Freeman Furnishings has summarized its data as shown:Depreciation of factory building$77,500Factory real estate taxes$15,000Factory utility expenses$85,000Indirect materials$32,000Indirect labor$25,000Direct labor cost$84,000Direct labor hours incurred21,500Estimated direct labor hours22,000Raw material purchasedRaw material, beginning inventoryRaw material, ending inventoryWork in process, beginning inventoryWork in process, ending inventoryEstimated overheadCompute the cost of goods manufactured, assuming that the overhead is allocated based on direct labor hours.$370,000$40,000$29,000$52,000$67,000$247,500

Answered: Compute the cost of goods manufactured,…

Business

Accounting

Compute the cost of goods manufactured, assuming that the overhead is allocated based on direct labor hours.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: The cost of a manufactured product generally comprises: a) direct materials cost b) direct labour…

A: In this question, we need to identify which of the given costs will be considered for calculating…

Q: This includes all manufacturing costs that cannot be classified as direct materials or direct labor.…

A: From all of the above, the Period cost is not directly concerned with the production. The prime cost…

Q: Overheads applied are calculated by: a.OAR times the estimated cost driver activity b. Budgeted…

A: Overhead is applied on the actual cost driver at the rate based on the estimated overhead and…

Q: Identify the following as fixed costs (F), variable costs (V), or mixed costs(M). direct labor…

A: A cost that changes, in total dollar amount, with the change in the level of activity is called…

Q: Calculate the total manufacturing costs for each job.

A: Overhead refers to the ongoing business expenses not directly attributed to creating a product or…

Q: Which of the following statements is true? a. Indirect materials and indirect labor are included in…

A: The true statement is "Indirect materials and indirect labor are included in the manufacturing…

Q: Why is industrial overhead calculated using direct labor

A: This question explains about industrial overhead that which is using direct labor:

Q: The cost of a manufactured product (product cost) generally consists of which of the following?…

A: Product Cost - Product Cost is the cost incurred by the organization for the product of the entity.…

Q: Why factory overhead is computed based on direct labor?

A: Refer Step 2 for explanation

Q: Wages paid to a labourer who is engaged in production activities should be classified as: a) direct…

A: Cost refers to the amount incurred in return for goods or services.

Q: Determine the following is best described as a fixed, variable, or mixed cost with respectto product…

A: Definition: Variable cost: The cost which changes with the change in the level of activity is called…

Q: Manufacturing overhead costs would include:a. Marketing costs related to selling the product.b. The…

Q: Is manufacturing overhead cost given to tasks based on a precise determination of each job's…

A: Concept: Generally, overhead costs in the manufacturing industry are assigned based on a predefined…

Q: What is the difference between a Job Order Cost System and a Process Cost System? Give an example…

A: Cost accounting system: Cost accounting system of an organization consists of procedures and…

Q: Define unit cost of a job.

A: Cost: It is the economic value incurred by an organization for manufacturing the products or…

Q: Prime cost is made of O direct raw material cost O direct raw material cost and direct labour cost O…

A: Prime Cost is made of direct raw material cost, direct labor cost and factory overhead.

Q: Production costs are inclusive of the following EXCEPT Selling and Distribution Cost Supervisor's…

A: Production cost is the cost incurred to produce a product.

Q: Prime cost consists of: Select one: O A. Direct labour O B. Direct materials and direct labour C.…

A: Factory overheads is the amount of indirect expenses which are not directly identifiable to the…

Q: When a manufacturing company uses direct labor, it assigns the cost by debiting O A. Wages Payable.…

A: Cost accounting is useful since it can show where a company spends money, how much it generates, and…

Q: Indirect manufacturing costs can be traced to the product that created the costs generally include…

A: Factory overhead is the indirect cost incurred in the process of manufacturing. Therefore, it is…

Q: Determine difference between the three methods used for allocating factory overhead costs to…

A: There are three basic cost allocation methods used for allocating the cost of products: the single…

Q: Which of the following is a part of Prime Cost? a. Direct Labour b. Indirect Wages c. Rent of…

A: Prime cost includes all the direct costs such as direct material, direct labor, and direct expenses.…

Q: What is the effect on the cost of goods sold and net operating income, if the cost of factory…

A: If cost of factory overhead applied are greater than the cost actual factory overhead, cost of goods…

Q: The cost of a manufactured product (product cost) generally consists of which of the following?…

A: Product Costs - Product cost are those cost which are incurred to manufacture the product. Other…

Q: What information is contained in a production report? What are equivalent units and how would a…

A: Financial report: Financial reports can be defined as the summary of statements that contains the…

Q: When using a normal costing system direct material and direct labor are recorded at standard…

A: Normal Costing System: In this costing system, the actual costs of producing the goods and…

Q: Identify each of the following costs as either a product cost (PROD) or a period cost (PER). Office…

A: Definition: Office manager salary

Question

Freeman Furnishings has summarized its data as shown:
Depreciation of factory building
$77,500
Factory real estate taxes
$15,000
Factory utility expenses
$85,000
Indirect materials
$32,000
Indirect labor
$25,000
Direct labor cost
$84,000
Direct labor hours incurred
21,500
Estimated direct labor hours
22,000
Raw material purchased
Raw material, beginning inventory
Raw material, ending inventory
Work in process, beginning inventory
Work in process, ending inventory
Estimated overhead
Compute the cost of goods manufactured, assuming that the overhead is allocated based on direct labor hours.
$370,000
$40,000
$29,000
$52,000
$67,000
$247,500

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

How do I calculate manufacturing overhead based on direct labor hours
2. Which of the following is a possible cost driver that may be used in calculating a company's predetermined overhead rate? A) Direct labour hours B) Direct labour dollars C) Machine hours D) All of the above
Identify each of the following costs as either a product cost (PROD) or a period cost (PER). Rent on factory building.
Total manufacturing costs for a period consist of the cost of direct materials used, the cost of direct labour incurred, and the actual manufacturing overhead cost incurred during the period. True O False
Is Manufacturing Overhead cost allocated to jobs by precisely identifying the overhead cost of each job or by an estimation? Explain.
Determine the following is best described as a fixed, variable, or mixed cost with respectto product units. Factory supervisor’s salary.
Which method of determining operating income is used internally for decision making and considers fixed factory overhead a period expense?
1. Overhead is most often applied to production on the basis ofa. direct labor hours.b. machine hours.c. raw material usage.d. number of units made.e. direct labor costs.
Which of the following is a prime cost? A.Factory maintenance expenses B.Administrative labor C.Direct labor D.Work in process inventory
A completed job cost record shows the unit cost of the products. How is this calculated?