Question

The following information applies to the questions displayed below.] Marcelino Co.'s March 31 inventory of raw materials is $84,000. Raw materials purchases in April are $520,000, and factory payroll cost in April is $388,000. Overhead costs incurred in April are: indirect materials, $57,000; indirect labor, $30,000; factory rent, $37,000; factory utilities, $20,000; and factory equipment depreciation, $52,000. The predetermined overhead rate is 50% of direct labor cost. Job 306 is sold for $650,000 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 $ 27,000 $ 42,000 Direct labor 23,000 17,000 Applied overhead 11,500 8,500 Costs during April Direct materials 137,000 215,000 $ 100,000 Direct labor 104,000 152,000 102,000 Applied overhead ? ? ? Status on April 30 Finished (sold) Finished (unsold) In process - Compute gross profit for April. - Show how to present the inventories on the April 30 balance sheet.

Answer 1

1
	Job 306	Job 307	Job 308	April Total
From March
Direct Materials	27000	42000		69000
Direct Labor	23,000	17,000		40000
Applied overhead	11,500	8,500		20000
Beginning goods in process	61500	67500	0	129000
For April
Direct Materials	137,000	215,000	100,000	452000
Direct Labor	104,000	152,000	102,000	358000
Applied overhead	52,000	76,000	51,000	179000
Total costs added in April	293000	443000	253000	989000
Total costs (April 30)	354500	510500	253000	1118000
Status on April 30	Finished (sold)	Finished (unsold)	In process
April 30 cost included in:	Cost of goods sold	Finished goods inventory	Goods in process inventory
Actual overhead = 57000+30000+37000+20000+52000= $196000
Underapplied overhead = 196000-179000 = $17000
4
Sales	650000
Less: Cost of goods sold	371500	=354500+17000
Gross profit	278500
Inventories
Raw materials	$95,000	=84000+520000-452000-57000
Goods in process	253,000
Finished goods	510,500
Total inventories	$858,500