Question

The following cost data relate to the manufacturing activities of Chang Company during the just completed year:Manufacturing overhead costs incurred:Indirect materials . $15,000Indirect labor . 130,000Property taxes, factory .8,000Utilities, factory .70,000Depreciation, factory .240,000Insurance, factory .10,000Total actual manufacturing overhead costs incurred $473,000Other costs incurred:Purchases of raw materials (both direct and indirect) - $400,000Direct labor costs - $60,000Inventories:Raw materials, beginning - $20,000Raw materials, ending - $30,000Work in process, beginning - $40,000Work in process, ending - $70,000Manufacturing OverheadActual Overhead Applied Overhead$473,000 $485,000$12,000 was overappliedHELP WITH THIS:Prepare a schedule of cost of goods manufactured for the year.

Answer 1

Answer:

Cost of goods manufactured:

Beginning WIP      20,000

cost added            920,000

total cost            940,000

ending WIP             (40,000)

COGM                    900,000

Explanation:

First, we calcualte the direct materials used into production:

Beginning Raw Materials   20,000

Purchases                         400,000

Ending Raw materials            30,000

used Indirect materials            (15,000)

Used into production          375,000

Second, the cost added which si the sum of the three main cost components

Cost added during the period:

materials                   375,000

direct labor             60,000

Applied Overhead   485,000  

Total added:              920,000

Then we can determinate the COGM

ecause the overapplication of overhead is done directly throught cost of goods sold we disregard this informaiton