Sturgis Manufacturing produces one model of precision tool and accounts for costs using a job cost system. Information from the most recent fiscal year indicates the following: • Total manufacturing cost during the year was $2,578,125 based on actual direct materials, actual direct labor, and applied manufacturing overhead. Of this amount, 40 percent was comprised of direct costs. • Manufacturing overhead was applied to work in process at 250 percent of direct materials dollars. Required: Compute actual direct materials used, actual direct labor, and applied manufacturing overhead.
Sturgis Manufacturing produces one model of precision tool and accounts for costs using a job cost system. Information from the most recent fiscal year indicates the following: • Total manufacturing cost during the year was $2,578,125 based on actual direct materials, actual direct labor, and applied manufacturing overhead. Of this amount, 40 percent was comprised of direct costs. • Manufacturing overhead was applied to work in process at 250 percent of direct materials dollars. Required: Compute actual direct materials used, actual direct labor, and applied manufacturing overhead.
Chapter1: Financial Statements And Business Decisions
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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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Transcribed Image Text:Sturgis Manufacturing produces one
model of precision tool and accounts for
costs using a job cost system. Information
from the most recent fiscal year indicates
the following:
●
Total manufacturing cost during the
year was $2,578,125 based on actual
direct materials, actual direct labor, and
applied manufacturing overhead. Of
this amount, 40 percent was comprised
of direct costs.
• Manufacturing overhead was applied
to work in process at 250 percent of
direct materials dollars.
Required:
Compute actual direct materials used,
actual direct labor, and applied
manufacturing overhead.
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