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Marcelino Co.'s March 31 inventory of raw materials is $88,000. Raw materials purchases in April are $570,000, and factory payroll cost in April is $391,000. Overhead costs incurred in April are: indirect materials, $52,000; indirect labor, $29,000; factory rent, $38,000; factory utilities, $19,000; and factory equipment depreciation, $53,000. 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		$	31,000			$	36,000
Direct labor			23,000				15,000
Applied overhead			11,500				7,500
Costs during April
Direct materials			130,000				210,000			$	105,000
Direct labor			103,000				155,000				104,000
Applied overhead			?				?				?
Status on April 30	Finished (sold)				Finished (unsold)					In process

4.1 Compute gross profit for April.

Gross Profit

4.2 Show how to present the inventories on the April 30 balance sheet.

Inventories
Raw materials
Work in process
Finished goods
Total inventories	$

Answer 1

				Job 306	Job 307	Job 308
Beginning balance of WIP on April1				65500	58500
Add: Cost incurred during the year
Material				130000	210000	105000
labour				103000	155000	104000
OH @ 50% of labour ccost				51500	77500	52000
Total cost of Jobs at the April end				350,000	501000	261000
Status				SOLD	FINISHEd	In Process
Raw material Inventory:
Begininig Inventory				88000
Add: Purchases				570000
Less: Consumed during the month
Direct material (130000+210000+105000)				445000
Indirect material				52000
Ending raw material inventory				161000
Gross Profit for the month:
Sales revenu of Job 306				635000
Less: Cost of Goods sold of Job 306				350000
Gross Profit for the month:				285000
Inventory balances on April30
Raw material inventory				161000
WIP inventory-Job 308				261000
Finished Goods Inventory-JOb307				501000