Direct Materials Control 1-1-2017 Work-in-Process Control 82,000 Finished Goods Control 1-1-2017 105,000 700,000 42,000 148,000 1-1-2017 Dir. manuf. labor 135,000 705,000 285,000 Manufacturing Overhead Control Manufacturing Overhead Allocated Cost of Goods Sold 425,000 Additional information follows: a. Direct manufacturing labor wage rate was $15 per hour. b. Manufacturing overhead was allocated at $20 per direct manufacturing labor-hour. c. During the year, sales revenues were $1,550,000, and marketing and distribution costs were $810,000. 1. What was the amount of direct materials issued to production during 2017? 2. What was the amount of manufacturing overhead allocated to jobs during 2017? 3. What was the total cost of jobs completed during 2017? 4. What was the balance of work-in-process inventory on December 31, 2017? 5. What was the cost of goods sold before proration of under- or overallocated overhead? What was the under- or overallocated manufacturing overhead in 2017? 7. Dispose of the under- or overallocated manufacturing overhead using the following: a. Write-off to Cost of Goods Sold b. Proration based on ending balances (before proration) in Work-in-Process Control, Finished Goods Control, and Cost of Goods Sold 8. Using each of the approaches in requirement 7, calculate Keezel's operating income for 2017. 9. Which approach in requirement 7 do you recommend Keezel use? Explain your answer briefly. Required
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
General ledger relationships, under- and over allocation. (S. Sridhar, adapted) Keezel Company uses normal costing in its
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