You are asked to bring the following incomplete accounts of one of Plentiful Printing’s printing plants up to date through January 31, 1992. Also consider the data that appears below. Materials (12/
You are asked to bring the following incomplete accounts of one of Plentiful Printing’s printing plants up to date through January 31, 1992. Also consider the data that appears below.
Materials (12/31/91 Balance) $15,000
Factory Department Overhead (total January charges) $57,000
Finished Goods (12/31/91 Balance) $20,000
1. The overhead is applied using a budgeted rate that is set every December by forecasting the following year’s overhead and relating it to forecast direct labor costs. The budget for 1992 called for $400,000 of direct labor and $600,000 of factory overhead.
2. The only job unfinished on January 31, 1992, was No. 419, on which total production costs were $13,000 (direct labor cost of $2,000 –125 direct labor hours–, direct materials cost of $8,000, and manufacturing overhead costs of $3,000).
3. Total materials placed into production during January were $90,000.
4. Cost of goods manufactured during January was $180,000.
5. Materials inventory as of January 31 was $20,000.
6. Finished goods inventory as of January 31 was $15,000.
7. All factory workers earn the same rate of pay. Direct labor hours for January totaled 2,500.
8. Sales during January of $285,000 were made.
9. Selling costs of $57,000 and administrative costs of $12,000 were incurred during January.
10. Materiality threshold for under/over applied overhead is $6,500
Required: (1 pt each)
1) Materials purchased during January
2) Cost of Goods Sold during January
3) Overhead applied during January
4) Overapplied or underapplied overhead for January (you must tell me both the amount and whether it is over or under for credit)