Question

In: Accounting

Identify all the costs that would be considered part of factory overhead and put an OH...

Identify all the costs that would be considered part of factory overhead and put an OH in the code column next to them. Identify all the costs that would be consider Selling, General and Administrative expenses and code them as “SGA”. Leave an item blank if it doesn't fall to either of the categories.

Account Amount
Supervisor salary                127,000
Production supplies                  14,000
WIP January 1                135,000
WIP December 31                142,000
Administrative salaries                404,000
Depreciation - manufacturing                113,000
Direct Labor - production                662,000
Water & Sewer - maunfacturing                     1,300
Water & Sewer - administrative                        900
Finished Goods - January 1                147,000
Finished Goods - December 31                160,000
Heat, light, & Power - manufacturing                  87,000
Marketing costs                185,000
Misc. manufacturing costs                  15,000
Plant maintenance and repairs                  68,000
Insurance - manufacturing facility                     5,800
Raw Materials Purchases                504,000
Raw Materials - January 1                102,000
Raw Materials - December 31                  81,000
Sales Revenue            2,488,000
Indirect labor                  22,000
Heat, light, & Power - administrative                  22,600
Depreciation - administrative                  40,500
Selling costs                  19,300
Factory security system                  15,550
Property taxes - manufacturing                     6,600
Property taxes - administrative                     2,000
Insurance - admistrative                     4,150
TOTAL FACTORY OVERHEAD
TOTAL SELLING AND ADMINISTRATIVE

Solutions

Expert Solution

Answer:

  • Factory overheads ( OH ) : It includes indirect materials , indirect labor and all factory expenses.
  • Selling, General & Administrative expenses ( SGA ) : It includes all expenses relating to administration and sales.
Account Code Amount
Supervisor salary OH 127,000
Production supplies 14,000
WIP January 1 135,000
WIP December 31 142,000
Administrative salaries SGA 404,000
Depreciation - manufacturing OH 113,000
Direct Labor - production 662,000
Water & Sewer - maunfacturing OH 1,300
Water & Sewer - administrative SGA 900
Finished Goods - January 1 147,000
Finished Goods - December 31 160,000
Heat, light, & Power - manufacturing OH 87,000
Marketing costs SGA 185,000
Misc. manufacturing costs OH 15,000
Plant maintenance and repairs OH 68,000
Insurance - manufacturing facility OH 5,800
Raw Materials Purchases 504,000
Raw Materials - January 1 102,000
Raw Materials - December 31 81,000
Sales Revenue 2,488,000
Indirect labor OH 22,000
Heat, light, & Power - administrative SGA 22,600
Depreciation - administrative SGA 40,500
Selling costs SGA 19,300
Factory security system OH 15,550
Property taxes - manufacturing OH 6,600
Property taxes - administrative SGA 2,000
Insurance - admistrative SGA 4,150
TOTAL FACTORY OVERHEAD 461,250
TOTAL SELLING AND ADMINISTRATIVE​ 678,450

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