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lowing tión in relation to the construction of a building during the year: Building Gratitude Company provided the Total Finished goods Direct labor Materials Overhead 6,000,000 7,000,000 2,000,000 4,200,000 3,000,000 1,800,000 4,000,000 ? The following assumptions are made: 1. No overhead is to be assigned to the building. 2. Normal production of finished goods is 180,000 units Because of the construction of the building, finished goods production totaled only 135,000 units. The building is to be charged with the overhead which would have been charged to the 45,000 units which were not produced. 3. Overhead is to be apportioned in the ratio of direct labor. Required: Compute the cost of finished goods and building

lowing tión in relation to the construction of a building during the year: Building Gratitude Company provided the Total Finished goods Direct labor Materials Overhead 6,000,000 7,000,000 2,000,000 4,200,000 3,000,000 1,800,000 4,000,000 ? The following assumptions are made: 1. No overhead is to be assigned to the building. 2. Normal production of finished goods is 180,000 units Because of the construction of the building, finished goods production totaled only 135,000 units. The building is to be charged with the overhead which would have been charged to the 45,000 units which were not produced. 3. Overhead is to be apportioned in the ratio of direct labor. Required: Compute the cost of finished goods and building

FINANCIAL ACCOUNTING
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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Gratitude Company provided the following information in relation to the construction of a building during the year: Building Total Finished goods Direct labor Materials Overhead 6,000,000 7,000,000 2,000,000 4,200,000 3,000,000 ? 1,800,000 4,000,000 ? The following assumptions are made: 1. No overhead is to be assigned to the building. 2. Normal production of finished goods is 180,000 units. Because of the construction of the building, finished goods production totaled only 135,000 units. The building is to be charged with the overhead which would have been charged to the 45,000 units which were not produced. 3. Overhead is to be apportioned in the ratio of direct labor. Required: Compute the cost of finished goods and building
Transcribed Image Text:Gratitude Company provided the following information in relation to the construction of a building during the year: Building Total Finished goods Direct labor Materials Overhead 6,000,000 7,000,000 2,000,000 4,200,000 3,000,000 ? 1,800,000 4,000,000 ? The following assumptions are made: 1. No overhead is to be assigned to the building. 2. Normal production of finished goods is 180,000 units. Because of the construction of the building, finished goods production totaled only 135,000 units. The building is to be charged with the overhead which would have been charged to the 45,000 units which were not produced. 3. Overhead is to be apportioned in the ratio of direct labor. Required: Compute the cost of finished goods and building
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