Elite Home Decor manufactures customized household furnishings. The company uses a perpetual inventory system and has a highly labour intensive production process, so it assigns manufacturing overhead based on direct labour cost. Elite expects to incur $2,205,000 of manufacturing overhead costs and estimated direct labour costs of $3,150,000 during 2020. At the end of December 2019, Elite reported work in process inventory (Job 551) of $93,000 The following events occurred during January - March 2020. i) Purchased materials on account, $392,000 ii) Incurred manufacturing wages of $400,000 iii) Requisitioned direct materials and used direct labour in manufacturing Direct Materials Direct Labour Job 551 Job 552 Job 553 Job 554 $70,200 97,500 105,300 117,000 $61,200 115,600 78,200 85,000 iv) Issued indirect materials to production, $30,000 v) Charged indirect manufacturing wages to production, $60,000 vi) Depreciation of production machinery, $85,000 vii) Other manufacturing overhead costs incurred on units 551 to 554 amounted to $49,000 viii)Allocated overheads to jobs at the predetermined rate ix) Units completed: 551, 552 & 554 x) Sold units 551 & 554 (billed customers at a margin of 33⅓% on sales) Compute Elite's gross profit earned on the jobs sold, after adjustingfor the manufacturing overhead. what is the balance in the cost of goods sold , after adjusting for the manufacturing overhead. poet the appropriate entries to work in process inventory account and determine the account balance on March 31, the end of the quarter.
Elite Home Decor manufactures customized household furnishings. The company uses a perpetual
inventory system and has a highly labour intensive production process, so it assigns manufacturing
overhead based on direct labour cost. Elite expects to incur $2,205,000 of
and estimated direct labour costs of $3,150,000 during 2020.
At the end of December 2019, Elite reported work in process inventory (Job 551) of $93,000
The following events occurred during January - March 2020.
i) Purchased materials on account, $392,000
ii) Incurred manufacturing wages of $400,000
iii) Requisitioned direct materials and used direct labour in manufacturing
Direct Materials Direct Labour
Job 551
Job 552
Job 553
Job 554
$70,200
97,500
105,300
117,000
$61,200
115,600
78,200
85,000
iv) Issued indirect materials to production, $30,000
v) Charged indirect manufacturing wages to production, $60,000
vi)
vii) Other manufacturing overhead costs incurred on units 551 to 554 amounted to $49,000
viii)Allocated
ix) Units completed: 551, 552 & 554
x) Sold units 551 & 554 (billed customers at a margin of 33⅓% on sales)
Compute Elite's gross profit earned on the jobs sold, after adjustingfor the manufacturing overhead.
what is the balance in the cost of goods sold , after adjusting for the manufacturing overhead.
poet the appropriate entries to work in process inventory account and determine the account balance on March 31, the end of the quarter.
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