Homework SourseThing Co uses a job order costing system At the beginning of
Thing Co. uses a job order costing system. At the beginning of July, the company had the following job in progress:
Job 70
$16539
During July, Thing Co. incurred the following job related costs:
Direct Materials
Direct Labour
Job 70
$2740
$1163
Job 80
12316
16294
Job 90
8248
7908
Manufacturing overhead is applied at a rate of $3.79 per $1 of direct labour cost. Jobs 70 and 90 were moved to finished goods during the month, but neither was sold by the end of the month. Job 80 is still in progress.
What would the debit to Finished Goods Inventory be for the month of July?
Select one:
a. $36598
b. $115214
c. $70977
d. $54438
| Job 70 | $16539 |
Solution
Answer is: c. $70,977
| Job 70 | Job 90 | |
| Opening work in process | $ 16,539 | |
| Add: Direct material added during the month | $ 2,740 | $ 8,248 |
| Add: Direct labour added during the month | $ 1,163 | $ 7,908 |
| Add: Manufacturing overhead applied during the month | $3.79*$1,163 = $4,407.77 | $3.79*$7,908 = $29,971.32 |
| Total manufacturing cost | $ 24,849.77 | $ 46,127.32 |
