Question

1.The following information is available for completed Job No. 402: Direct materials, $220000; direct labor, $280000; manufacturing overhead applied, $210000; units produced, 5000 units; units sold, 4000 units. The cost of the finished goods on hand from this job is

2.If a company has a discontinued operation gain of $45000 and a 34% tax rate, what is the effect on net income?

3.Cullumber Company sold its licorice division resulting in a loss of $83000. Assuming a tax rate of 29%, the loss on this disposal will be reported on the income statement at what amount?

4.Crane Company's accounting records reflect the following inventories:

	Dec. 31, 2017		Dec. 31, 2016
Raw materials inventory	$210000		$160000
Work in process inventory	300000		160000
Finished goods inventory	190000		150000

During 2017, $700000 of raw materials were purchased, direct labor costs amounted to $670000, and manufacturing overhead incurred was $640000.
Crane Company's total manufacturing costs incurred in 2017 amounted to

5.Vaughn Manufacturing's accounting records reflect the following inventories:

	Dec. 31, 2020		Dec. 31, 2019
Raw materials inventory	$310000		$260000
Work in process inventory	300000		160000
Finished goods inventory	190000		150000

During 2020, $1000000 of raw materials were purchased, direct labor costs amounted to $768200, and manufacturing overhead incurred was $768000.

If Vaughn Manufacturing's cost of goods manufactured for 2020 amounted to $2346200, its cost of goods sold for the year is

6.Coronado Industries's accounting records reflect the following inventories:

	Dec. 31, 2019		Dec. 31, 2020
Raw materials inventory	$ 84000		$ 67000
Work in process inventory	106000		118000
Finished goods inventory	100000		92000

During 2020, Coronado purchased $1450000 of raw materials, incurred direct labor costs of $250000, and incurred manufacturing overhead totaling $160000.
How much raw materials were transferred to production during 2020 for Coronado?

7.Waterway Industries reported total manufacturing costs of $400000, manufacturing overhead totaling $60000, and direct materials totaling $65000. How much is direct labor cost?

Answer 1

Question 1:

Particulars	$
Direct Materials	220,000
Direct Labor	280,000
Manufacturing Overhead	210,000
Total Product Cost	710,000

Total Product cost per unit = $710,000 / 5,000 Units = $142 per unit

Finished goods on hand = (5,000 Units - 4,000 Units) * $142 per unit = $142,000

Question 2:

Particulars	$
Discontinued Operation gain	45,000
Less: Tax @ 34% ($45,000 * 34%)	15,300
Increase of Net Income	29,700

Question 3:

Loss on sale of licorice division = $83,000

Tax rate = 29%

Loss on the disposal will be reported on the Income statement = $83,000 * (1 - 0.29) = $58,930

Question 4:

Particulars	$
Beginning Raw material Inventory	160,000
Add: Raw materials purchased	700,000
Less: Ending Raw materials Inventory	210,000
Direct Materials Used	650,000
Direct Labor	670,000
Manufacturing overheads	640,000
Total Manufacturing Costs Incurred in 2017	1,960,000

Question 5:

Particulars	$
Cost of goods manufactured	2,346,200
Add: Beginning finished goods Inventory	150,000
Cost of goods available for sale	2,496,200
Less: Ending finished goods Inventory	190,000
Cost of goods sold	2,306,200

Question 6:

Particulars	$
Beginning Raw materials Inventory	84,000
Add: Raw materials purchased	1,450,000
Less: Ending Raw materials Inventory	67,000
Raw materials transferred to production	1,467,000

Question 7:

Particulars	$
Total Manufacturing Costs	400,000
Less: Manufacturing Overheads	60,000
Less: Direct Materials	65,000
Direct Labor cost	275,000

All the best...