Question - Hassenger has a job-order costing system. The company applies manufacturing overhead to jobs using a predetermined overhead rate based on direct labor cost. The information below has been taken from the cost records of the company for the past year:
Inventories:
Direct materials used in production $1,400
Direct materials, January 1 $480
Total manufacturing costs added during period $8,000
Direct materials, December 31 $520
Applied manufacturing overhead $3,300
Work in process, January 1 $730
Selling & Administrative expense $2,150
Work in process, December 31 $650
Finished goods, January 1 $480
Finished goods, December 31 $460
Required:
Compute the cost of direct materials purchased during the year.
Compute the predetermined overhead rate that was used during the year.
Compute the Cost of Goods Manufactured for the year.
Compute the Cost of Goods Sold for the year. (Do not close any under- or overapplied manufacturing overhead to Cost of Goods Sold.)