Highview Corp. applies manufacturing overhead to production at 125% of direct labor cost. During the year ended 20x8, manufacturing overhead of $100,000 was applied to production; actual manufacturing overhead was $109,000. Beginning Work in Process Inventory was $15,000 and beginning Finished Goods Inventory was $35,000. Work in Process Inventory increased by 10% during the year and Finished Goods Inventory decreased by 20% during the year. Sales for the year ended 20xx were $450,000, yielding a $130,000 gross profit. Complete the following schedule:Direct materials used in production?Direct labor?Manufacturing overhead applied?Current manufacturing costs?  Beginning Work in Process Inventory?  Ending Work in Process Inventory?Cost of goods manufactured? 

Beginning Finished Goods Inventory?  Ending Finished Goods Inventory?Unadjusted Cost of Goods Sold?Overhead adjustment?Adjusted Cost of Goods Sold?

What will be an ideal response?


Sales$450,000?
Less: Cost of Goods Sold (320,000)?
Gross Profit $130,000?
Use Cost of Goods Sold $320,000 at the bottom of the following statement and work backwards to find direct materials used in production:?
Direct materials used in production$125,500
Direct labor80,000
Manufacturing overhead applied100,000
Current manufacturing costs305,500
Beginning Work in Process Inventory15,000
Ending Work in Process Inventory16,500
Cost of goods manufactured304,000
Beginning Finished Goods Inventory35,000
Ending Finished Goods Inventory28,000
Unadjusted Cost of Goods Sold311,000
Overhead adjustment9,000
Adjusted Cost of Goods Sold$320,000
Cost of goods manufactured = Direct materials + Direct labor + Applied overhead + Beginning WIP - Ending WIP. Over- or underapplied overhead = Actual - Applied overhead. Adjusted cost of goods sold = Beginning finished goods + cost of goods manufactured - Ending finished goods +/- Under/overapplied overhead.

Business

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