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Marcelino Co.'s March 31 inventory of raw materials is $80,000. Raw materials purchases in April are $500,000, and factory payroll cost in April is $363,000. Overhead costs incurred in April are: indirect materials, $50,000; indirect labor, $23,000; factory rent, $32,000; factory utilities, $19,000; and factory equipment depreciation, $51,000. The predetermined overhead rate is 50% of direct labor cost. Job 306 is sold for $635,000 cash in April. Costs of the three jobs worked on in April follow.

	Job 306				Job 307				Job 308
Balances on March 31
Direct materials		$	29,000			$	35,000
Direct labor			20,000				18,000
Applied overhead			10,000				9,000
Costs during April
Direct materials			135,000				220,000			$	100,000
Direct labor			85,000				150,000				105,000
Applied overhead			?				?				?
Status on April 30	Finished (sold)				Finished (unsold)					In process

1. Determine the total of each production cost incurred for April (direct labor, direct materials, and applied overhead), and the total cost assigned to each job (including the balances from March 31).

Job 306 Job 307 Job 308 April Total From March Direct Materials $29,000 $35,000 $64,000 Direct Labor 20,000 18,000 38,000 Applied overhead 10,000 9,000 19,000 Beginning goods in process $0 For April Direct Materials 135,000 220,000 100,000 455,000 Direct Labor 85,000 150,000 105,000 340,000 Applied overhead 0 Total costs added in April 220,000 370,000 205,000 795,000 Total costs (April 30) $0 Status on April 30 Finished (sold) Finished (unsold) In process April 30 cost included in:

1. Materials purchases (on credit).
2. Direct materials used in production.
3. Direct labor paid and assigned to Work in Process Inventory.
4. Indirect labor paid and assigned to Factory Overhead.
5. Overhead costs applied to Work in Process Inventory.
6. Actual overhead costs incurred, including indirect materials. (Factory rent and utilities are paid in cash.)
7. Transfer of Jobs 306 and 307 to Finished Goods Inventory.
8. Cost of goods sold for Job 306.
9. Revenue from the sale of Job 306.
10. Assignment of any underapplied or overapplied overhead to the Cost of Goods Sold account. (The amount is not material.)

2. Prepare journal entries for the month of April to record the above transactions.

3. Prepare a schedule of cost of goods manufactured.

	MARCELINO COMPANY Schedule of Cost of Goods Manufactured For Month Ended April 30 Total manufacturing costs Total cost of work in process Cost of goods manufactured

4.1 Compute gross profit for April.

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Answer 1