Allocate the common cost to Factory, Sales, and Administrative with a solution. The following information were obtained from the records of Sunshine Enterprise for the current year ended December 31:Cash19800Accounts ReceivableRaw Materials Inventory Jan 14400070000Raw Materials Inventory Dec 31Work in Process Jan 1Work in Process Dec 31Finished Goods Jan 1800001500042000109900Finished Goods Dec 31155000Indirect Labor50000Direct Labor142500Factory supplies used30000Freight inAdvertising Expense900016000Sales Salaries25000Administrative SalariesBad Debt ExpenseAllowance for Bad DebtsDirect Material PurchasesSales4100050003100137500471000The costs below are common costs incurred by various facilities to be allocated as follows: (Hint: Costs allocated to Factory will bepart of Factory Overhead)Total CostsFactoryAdministrativeSales10%Utilities2500060%30%Тахes3500060%25%15%60%20%20%InsuranceDepreciation100003000060%20%20%

given total costs factory sales administrative utilities 25000 60% 10% 30% taxes…

Answered: Allocate the common cost to Factory,…

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Accounting

Allocate the common cost to Factory, Sales, and Administrative with a solution

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

Question

Allocate the common cost to Factory, Sales, and Administrative with a solution.

The following information were obtained from the records of Sunshine Enterprise for the current year ended December 31:
Cash
19800
Accounts Receivable
Raw Materials Inventory Jan 1
44000
70000
Raw Materials Inventory Dec 31
Work in Process Jan 1
Work in Process Dec 31
Finished Goods Jan 1
80000
15000
42000
109900
Finished Goods Dec 31
155000
Indirect Labor
50000
Direct Labor
142500
Factory supplies used
30000
Freight in
Advertising Expense
9000
16000
Sales Salaries
25000
Administrative Salaries
Bad Debt Expense
Allowance for Bad Debts
Direct Material Purchases
Sales
41000
5000
3100
137500
471000
The costs below are common costs incurred by various facilities to be allocated as follows: (Hint: Costs allocated to Factory will be
part of Factory Overhead)
Total Costs
Factory
Administrative
Sales
10%
Utilities
25000
60%
30%
Тахes
35000
60%
25%
15%
60%
20%
20%
Insurance
Depreciation
10000
30000
60%
20%
20%

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