nding direct materials inventory $10,000 Beginning WIP inventory 64,000 Beginning finished goods inventory 58,000 Direct materials purchased on account $ 70,000 Direct materials used or requisitioned 90,000 Direct labor cost incurred 130,000 Factory overhead incurred (actual) 190,000 Overhead is applied at 150 percent (1.5) of direct-labor cost Cost of goods manufactured 405,000 Cost of goods sold 460,000 The beginning balance of direct materials inventory must be:
nding direct materials inventory $10,000 Beginning WIP inventory 64,000 Beginning finished goods inventory 58,000 Direct materials purchased on account $ 70,000 Direct materials used or requisitioned 90,000 Direct labor cost incurred 130,000 Factory overhead incurred (actual) 190,000 Overhead is applied at 150 percent (1.5) of direct-labor cost Cost of goods manufactured 405,000 Cost of goods sold 460,000 The beginning balance of direct materials inventory must be:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Question 1 options:
Answer the following two questions using the information below:
Preston Manufacturing uses a normal cost system and had the following actual data available for 20X5:
Ending direct materials inventory $10,000
Beginning WIP inventory 64,000
Beginning finished goods inventory 58,000
Direct materials purchased on account $ 70,000
Direct materials used or requisitioned 90,000
Direct labor cost incurred 130,000
Factoryoverhead incurred (actual) 190,000
Overhead is applied at 150 percent (1.5) of direct-labor cost
Cost of goods manufactured 405,000
Cost of goods sold 460,000
The beginning balance of direct materials inventory must be:
Preston Manufacturing uses a normal cost system and had the following actual data available for 20X5:
Ending direct materials inventory $10,000
Beginning WIP inventory 64,000
Beginning finished goods inventory 58,000
Direct materials purchased on account $ 70,000
Direct materials used or requisitioned 90,000
Direct labor cost incurred 130,000
Factory
Overhead is applied at 150 percent (1.5) of direct-labor cost
Cost of goods manufactured 405,000
Cost of goods sold 460,000
The beginning balance of direct materials inventory must be:
(HINT: use T-Accounts to solve)
(Include "$" and "," (commas) in your answers.
The ending balance of work-in-process inventory (before closing the manufacturing overhead accounts) must be:
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