Managerial Accounting: Creating Value in a Dynamic Business Environment
11th Edition
ISBN: 9781259569562
Author: Ronald W Hilton Proffesor Prof, David Platt
Publisher: McGraw-Hill Education
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Question
Chapter 3, Problem 59P
To determine
Calculate the missing amounts and prepare the T-accounts.
Expert Solution & Answer
Explanation of Solution
- 1. Calculate the sales revenue for November.
Thus, the sales revenue for November is $216,000.
- 2. Calculate the ending balance of accounts receivable.
Thus, the ending balance in accounts receivable is $19,000.
- 3. Calculate the cost of raw materials purchased during November.
Thus, the cost of raw materials purchased during November is $70,000.
- 4. Calculate the ending balance in the work-in-process inventory.
Step 1: Calculate the budgeted direct-labor hours.
Step 2: Calculate the predetermined overhead rate.
Step 3: Calculate the ending balance in the work-in-process inventory.
Thus, the ending balance in the work-in-process inventory is $38,000.
- 5. Calculate the amount of direct labor added to work in process during November.
Thus, the amount of direct labor added to work in process during November is $80,000.
- 6. Calculate the amount of applied overhead for November.
Step 1: Calculate the direct-labor hours.
Step 2: Calculate the amount of applied overhead for November.
Thus, the applied overhead for November is $60,000.
- 7. Calculate the cost of goods completed during November.
Thus, the cost of goods completed during November is $150,000.
- 8. Calculate the amount of raw materials used during November.
Thus, the amount of raw materials used during November is $40,000.
- 9. Calculate the amount of October 31 balance in raw-material inventory.
Thus, the amount of October 31 balances in raw-material inventory is $15,000.
- 10. Calculate the amount of overapplied or underapplied for November.
Thus, there is no underapplied or overapplied overhead for the month November.
Prepare the T-accounts.
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Students have asked these similar questions
Mary Potts arrived at her stored on the morning of January 29, she found empty shelves and display racks; thieves had broken in during the night and stolen the entire inventory. Accounting record showed that Potts had inventory costing $50,000 on January 1. From January 1 to January 29, Potts had made net sales of $70,000 and net purchase of $80,000. The gross profit during the past several years had consistently averaged 42 percent of net sales. Potts plan to file an insurance claim for the theft loss.
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Chapter 3 Solutions
Managerial Accounting: Creating Value in a Dynamic Business Environment
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