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X Manufacturing uses a normal cost system and had the following data available for 20x8: Direct materials...

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Accounting

X Manufacturing uses a normal cost system and hadthe following data available for 20x8:
Direct materials purchased on account$148,000
Direct materials requisitioned98,000
Direct labor cost incurred127,000
Factory overhead budgeted151800
Factory overhead incurred138,200
Cost of goods sold260,000
Beginning direct materials inventory34,000
Beginning WIP inventory70,000
Beginning finished goods inventory55,000
Ending finished goods inventory104,000
Overhead application rate, as a percent of direct-laborcosts115%
Round your answers to the nearest dollar. Fill inthe blank without $ or comma or period, e.g., 12345
What is the adjusted cost of goods sold assumingthe over/under applied overhead is immaterial?

Answer & Explanation Solved by verified expert
4.5 Ratings (920 Votes)

Unadjusted Cost of Goods sold          260,000
Less: Overapplied Overhead            (7,850)
Adjusted cost of Goods sold          252,150
Note 1: Calculate applied Overhead
Direct Labour cost          127,000
Overhead applied          146,050 (127000*115%)
Note 2:
Actual Overhead Incurred          138,200
Less: overhead applied          146,050
Overapplied Overhead              7,850

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