Question

Use the following information to answer questions

[The following information applies to the questions displayed below.]

The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system.

	April 30				May 31
Inventories
Raw materials	$	44,000			$	54,000
Work in process		9,500				18,800
Finished goods		59,000				34,000
Activities and information for May
Raw materials purchases (paid with cash)						185,000
Factory payroll (paid with cash)						250,000
Factory overhead
Indirect materials						10,000
Indirect labor						57,500
Other overhead costs						114,500
Sales (received in cash)						1,600,000
Predetermined overhead rate based on direct labor cost						55	%

Exercise 19-7 Cost flows in a job order costing system LO P1, P2, P3, P4

Compute the following amounts for the month of May using T-accounts.

1. Cost of direct materials used.
2. Cost of direct labor used.
3. Cost of goods manufactured.
4. Cost of goods sold.*
5. Gross profit.
6. Overapplied or underapplied overhead.

  
*Do not consider any underapplied or overapplied overhead.

Raw Materials (RM)Work in Process (WIP)April 3044,000April 309,500RM purchases185,000DM used176,40057,500Indirect laborDL used117,500DM usedOverhead appliedMay 3154,000May 31185,900Finished Goods (FG)Factory OverheadApril 3059,000Cost of goods manuf.Cost of goods soldMay 3159,0000

Answer 1