Question

Dacosta Corporation had only one job in process on May 1. The job had been charged with $2,400 of direct materials, $6,966 of direct labor, and $10,104 of manufacturing overhead cost. The company assigns overhead cost to jobs using the predetermined overhead rate of $19.60 per direct labor-hour.

During May, the following activity was recorded:

Raw materials (all direct materials):
Beginning balance	$	9,100
Purchased during the month	$	38,600
Used in production	$	39,900
Labor:
Direct labor-hours worked during the month		2,500
Direct labor cost incurred	$	25,110
Actual manufacturing overhead costs incurred	$	33,900
Inventories:
Raw materials, May 30		?
Work in process, May 30	$	17,093

Work in process inventory on May 30 contains $3,849 of direct labor cost. Raw materials consist solely of items that are classified as direct materials.

The cost of goods manufactured for May was:

Multiple Choice

• $97,230

• $110,720

• $114,010

• $116,387

Answer 1

Answer:

Option D is the correct answer.

Explanation

Dacosta Corporation
COST OF GOODS MANUFACTURED SCHEDULE
Direct Material used:
Beginning Raw material inventory	$              9,100
Add: cost of raw material purchased	$            38,600
Total raw material available	$            47,700
Less: Ending Raw material inventory	$              7,800
Total raw material used		$            39,900
Direct labour		$            25,110
Manufacturing overhead applied (2,500* $19.60)		$            49,000
Total manufacturing cost		$          114,010
Add: Beginning work-in-process inventory		$            19,470
		$          133,480
Less: Ending work-in-process inventory		$            17,093
Cost of goods manufactured		$          116,387