Problem 20 1A Production cost flow and measurement; journal entries L.O. P1, P2, P3, P4
[The following information applies to the questions displayed below.]
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Edison Company manufactures wool blankets and accounts for product costs using process costing. The following information is available regarding its May inventories. |
| Beginning Inventory |
Ending Inventory |
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| Raw materials inventory | $ | 69,000 | $ | 55,000 | ||
| Goods in process inventory | 401,000 | 542,500 | ||||
| Finished goods inventory | 634,000 | 536,001 | ||||
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| The following additional information describes the company’s production activities for May. |
| Raw materials purchases (on credit) | $ | 280,000 | |
| Factory payroll cost (paid in cash) | 1,894,000 | ||
| Other overhead cost (Other Accounts credited) | 98,000 | ||
| Materials used | |||
| Direct | $ | 217,000 | |
| Indirect | 72,000 | ||
| Labor used | |||
| Direct | $ | 1,104,000 | |
| Indirect | 790,000 | ||
| Overhead rate as a percent of direct labor | 115 | % | |
| Sales (on credit) | $ | 4,000,000 | |
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| The predetermined overhead rate was computed at the beginning of the year as 115% of direct labor cost. |
rev: 11_02_2011
references
1. value:
2.00 points
Problem 20 1A Part 1
| Required: | |
| 1(a) |
Compute the cost of products transferred from production to finished goods. (Omit the “$” sign in your response.) |
| Cost of products transferred | $ |
| 1(b) |
Compute the cost of goods sold. (Omit the “$” sign in your response.) |
| Cost of goods sold | $ |