Chapter 3 Cost Accounting

chapter 3

Exe# 6 In question direct labor hours is not given, we can find D.Labor hours through this formula Direct labor cost = 40000 = 6250 Hours Per D.Labor hours rate 6.40 1) Prime Cost (2) Conversion Cost
Material opening 24000 Direct labor 40000
+ purchase 56000 FOH Applied
Material available for use 80000 6250 Hours@ 8 50000
- Material ending (20000) Conversion cost 90000
Material used 60000
+ Direct labor 40000

Prime Cost 100000

(3) Cost of goods manufactured (4) Cost of goods sold

Prime cost 100000 Cost of goods manufactured 154000
Applied FOh + Finished goods opening 36000
6250@8 50000 Cost of goods available for sale 190000
Total manufacturing cost 150000 - Finished goods ending (40000)
+ WIP opening 12000 Cost of goods sold 150000
Cost of Work put into process 162000
- W.I.P ending (8000)

Cost of goods manufactured 154000

( 5) Income statement

Sale 200000
- C.G.S (150000)

Gross profit 50000

Less; operation expense

Marketing and administrative
Expense (200000*10/100) (20000)

Net income 30000

Exe – 4 Req(1) Estimated cost to produce or Total manufacturing cost

Direct labor 10100
Direct material 7500
FOH
Molding department ( 800*5) 4000
Finishing department =4300*120/100 5160

Total manufacturing cost 26760

Req (2) Prime cost Req (3) Conversion cost Direct labor 10100
Direct material 7500 FOH
Direct labor 10100 Molding department (800*5) 4000 Finishing department =4300*120/100 5160
Prime cost 17600 Conversion cost 19260

Req (4) Bid price/ sale price
Direct labor 10100
Direct material 7500
FOH
Molding department ( 800*5) 4000
Finishing department =4300*120/100 5160

Total manufacturing cost 26760

Markup (