Required information Skip to question [The following information applies to the questions displayed below.] Sierra Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All direct materials enter production at the beginning of the cutting process. The following information is available regarding its May inventories: Beginning Inventory Ending Inventory Raw materials inventory $ 6,000 $9,250 Work in process inventory-Cutting 43,500 51,500 Work in process inventory-Stitching 63, 300 60, 500 Finished goods inventory 20, 100 8,250 The following additional information describes the company's production activities for May. Direct materials Raw materials purchased on credit $25,000 Direct materials used-Cutting 21,750 Direct materials used-Stitching 0 Direct labor Direct labor-Cutting $ 15,600 Direct labor-Stitching 62, 400 Factory Overhead (Actual costs) Indirect materials used $6,000 Indirect labor used 55,000 Other overhead costs 46, 505 Factory Overhead Rates Cutting 150% of direct materials used Stitching 120% of direct labor used Sales $256,000 Required: 1. Compute the amount of (a) production costs transferred from Cutting to Stitching, (b) production costs transferred from Stitching to finished goods, and (c) cost of goods sold. Hint: Compute the total production costs in each department and then subtract the ending inventory to get the amount transferred out of each department
Required information Skip to question [The following information applies to the questions displayed below.] Sierra Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All direct materials enter production at the beginning of the cutting process. The following information is available regarding its May inventories: Beginning Inventory Ending Inventory Raw materials inventory $ 6,000 $9,250 Work in process inventory-Cutting 43,500 51,500 Work in process inventory-Stitching 63, 300 60, 500 Finished goods inventory 20, 100 8,250 The following additional information describes the company's production activities for May. Direct materials Raw materials purchased on credit $25,000 Direct materials used-Cutting 21,750 Direct materials used-Stitching 0 Direct labor Direct labor-Cutting $ 15,600 Direct labor-Stitching 62, 400 Factory Overhead (Actual costs) Indirect materials used $6,000 Indirect labor used 55,000 Other overhead costs 46, 505 Factory Overhead Rates Cutting 150% of direct materials used Stitching 120% of direct labor used Sales $256,000 Required: 1. Compute the amount of (a) production costs transferred from Cutting to Stitching, (b) production costs transferred from Stitching to finished goods, and (c) cost of goods sold. Hint: Compute the total production costs in each department and then subtract the ending inventory to get the amount transferred out of each department
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Required information Skip to question [The following information applies to the questions displayed below.] Sierra
Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All direct materials enter
production at the beginning of the cutting process. The following information is available regarding its May inventories:
Beginning Inventory Ending Inventory Raw materials inventory $ 6,000 $9,250 Work in process inventory-Cutting
43,500 51,500 Work in process inventory-Stitching 63, 300 60, 500 Finished goods inventory 20, 100 8,250 The
following additional information describes the company's production activities for May. Direct materials Raw materials
purchased on credit $25,000 Direct materials used-Cutting 21,750 Direct materials used-Stitching 0 Direct labor Direct
labor-Cutting $ 15,600 Direct labor-Stitching 62, 400 Factory Overhead (Actual costs) Indirect materials used $6,000
Indirect labor used 55,000 Other overhead costs 46, 505 Factory Overhead Rates Cutting 150% of direct materials used
Stitching 120% of direct labor used Sales $256,000 Required: 1. Compute the amount of (a) production costs
transferred from Cutting to Stitching, (b) production costs transferred from Stitching to finished goods, and (c) cost of
goods sold. Hint: Compute the total production costs in each department and then subtract the ending inventory to get
the amount transferred out of each department](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Faab5760f-bc6e-434a-8cd6-76fc264a59f0%2F968930be-b3b5-4230-80a2-4235dafdf0df%2F5q2gwz_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required information Skip to question [The following information applies to the questions displayed below.] Sierra
Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All direct materials enter
production at the beginning of the cutting process. The following information is available regarding its May inventories:
Beginning Inventory Ending Inventory Raw materials inventory $ 6,000 $9,250 Work in process inventory-Cutting
43,500 51,500 Work in process inventory-Stitching 63, 300 60, 500 Finished goods inventory 20, 100 8,250 The
following additional information describes the company's production activities for May. Direct materials Raw materials
purchased on credit $25,000 Direct materials used-Cutting 21,750 Direct materials used-Stitching 0 Direct labor Direct
labor-Cutting $ 15,600 Direct labor-Stitching 62, 400 Factory Overhead (Actual costs) Indirect materials used $6,000
Indirect labor used 55,000 Other overhead costs 46, 505 Factory Overhead Rates Cutting 150% of direct materials used
Stitching 120% of direct labor used Sales $256,000 Required: 1. Compute the amount of (a) production costs
transferred from Cutting to Stitching, (b) production costs transferred from Stitching to finished goods, and (c) cost of
goods sold. Hint: Compute the total production costs in each department and then subtract the ending inventory to get
the amount transferred out of each department
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