Michelle’s Holiday Styles has been busy in the month of November! It seems Michelle’s marketing efforts have paid off, as she has answered many calls to help decorate homes for the upcoming holidays. The company carries an inventory of decorative items in its store and then installs them in creative and fun ways. The MOH costs are fairly low, since the company has just a small space to hold the inventory. The applied MOH rate is $10 per direct labor hour. As of November 30, the company carries the following balances in its inventory accounts. DM Inventory $7,600 WIP Inventory 9,350 FG Inventory 0 During December, the following events occurred. 1. Purchased direct materials costing $16,100 on account. 2. Used $20,700 of direct materials for jobs. 3. Paid direct labor wages for 141 hours of labor ($25/hr). 4. Applied MOH cost to jobs. 5. Actually incurred $3,500 in MOH costs. 6. Completed all jobs by the end of the month. 7. Billed clients $48,400 for jobs completed. 8. Closed under- or overapplied MOH using the direct write-off method. Determine the company’s total cost of goods completed and COGS in December. Total cost of goods completed and COGS $enter the total cost of goods completed and cost of goods sold in dollars

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Michelle’s Holiday Styles has been busy in the month of November! It seems Michelle’s marketing efforts have paid off, as she has answered many calls to help decorate homes for the upcoming holidays. The company carries an inventory of decorative items in its store and then installs them in creative and fun ways. The MOH costs are fairly low, since the company has just a small space to hold the inventory. The applied MOH rate is $10 per direct labor hour.

As of November 30, the company carries the following balances in its inventory accounts.

DM Inventory		$7,600
WIP Inventory		9,350
FG Inventory		0

During December, the following events occurred.

1.		Purchased direct materials costing $16,100 on account.
2.		Used $20,700 of direct materials for jobs.
3.		Paid direct labor wages for 141 hours of labor ($25/hr).
4.		Applied MOH cost to jobs.
5.		Actually incurred $3,500 in MOH costs.
6.		Completed all jobs by the end of the month.
7.		Billed clients $48,400 for jobs completed.
8.		Closed under- or overapplied MOH using the direct write-off method.

Determine the company’s total cost of goods completed and COGS in December.

Total cost of goods completed and COGS

$enter the total cost of goods completed and cost of goods sold in dollars

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How much gross margin did the company earn in December? (Round percentage answer to 2 decimal places, e.g. 52.75%.)

Gross margin		$enter percentages rounded to 2 decimal places
Gross margin percentage		enter percentages rounded to 2 decimal places %

If Michelle had a goal of earning a 35% gross margin, did she reach her goal?

select an option , she select an option reach her goal, because enter percentages rounded to 2 decimal places % is select an option than her goal of 35%.

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