TEST 1 – Take Home

If your answers do not come out even, round to THE NEAREST DOLLAR.

Suggested Step 1.

Each member of the group will work all the problems on their own by writing down the solution first and then filling
in the data needed to solve the problem. Work the problem two or three times until you understand what you need
to know to solve the problem and are not just memorizing. I am available for help with this, but only to understand the
concept not to help you solve a specific problem on the test.

Suggested Step 2.

Meet as a group and repeat Step 1 as a group and turn in.

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. Given the following for Myra, Inc.
Direct Materials $500,000
Direct Labor $600,000
Variable Factory Overhead $700,000
Fixed Factory Overhead $100,000
Fixed Selling Expenses $400,000
Variable Administrative Expenses $700,000

The product costs and period costs for a traditional format income statement are:

Product Costs

Period Costs

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Given the following data for Yun Company for the current year. Yun began business
6 years ago. Partial financial information is given below

Beginning work-in-process 200

Direct Materials transferred out 300

Direct Labor 500

Work-in-process transferred to finished goods 300

Goods Available for Sale 2,800

Cost of Goods Sold 500

Applied factory overhead is twice the direct labor costs.

What is the ending work-in-process inventory?

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Selected data concerning the past fiscal year’s operation of the KNY Manufacturing Company are presented below.
Inventories
Beginning Ending
Direct materials $ 50 $ 60
Work-in-process 80 10
Finished goods 120 140

Other data:
Direct materials purchased 480
Cost of goods available for sale 700
Selling and general expenses 100

Total manufacturing costs charged to production during

the year (includes direct materials, direct labor, and variable
factory overhead applied at a rate of 300% of direct labor costs).
(There were no fixed overhead costs)

The cost of direct materials purchased during the year amounted to:

The total amount variable cost charged to production during the year amounted to:

The cost of goods manufactured for the year was:

The cost of goods sold during the year was:

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PHO Manufacturing Company presented below the following data concerning the past fiscal year’s operation:
Inventories
Beginning Ending
Direct materials $60 $40
Work-in-process 80 30
Finished goods 140 120

Other data:
Direct materials purchased $ 500
General selling and administrative overhead 100

Direct labor hours worked were 300 direct labor hours. All workers are paid $10 per direct labor hour.

Variable factory overhead is applied at a rate of 20% of direct labor costs.

Fixed factory overhead is applied based on direct labor hours.

Estimated overhead fixed costs are $100,000 based on an estimated 10,000 direct labor hours.

Total manufacturing costs charged to production during the year (includes direct materials, direct labor, and
applied variable and fixed factory overhead.)

Total manufacturing costs charged to production during the year (includes direct materials, direct labor, and
applied variable and fixed factory overhead.)

A. What are the manufacturing costs?

B. What is the cost of goods manufactured?
C. What is cost of goods sold?

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Corvette uses a job order cost system and
applies factory overhead to production orders on the basis of direct-labor hours.

Data from the current year budget showed the following:

Estimated direct labor costs - ?
Estimated overhead costs - $800,000
Estimated direct labor hours - 200,000 direct labor hours

All workers are paid $5 per direct labor hour

Job 123 was started last year and job 456 was started this year. Only Job 456 was completed during the
current year. Job 456 was delivered to the customer.

The jobs are charged with the following costs:

JOB 123 JOB 456

Beginning Work-In-Process $30,000
Current year costs:
Direct Labor Hours 1,000 2,000

Manufacturing Costs $18,000 $24,000

Units in job order 5 10

A. Total cost of goods manufactured is:

B. Materials put into production during the current year:
C. The unit cost of goods sold is:
D. Ending work-in-process is:

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 LOC Manufacturing Co. presents the following information from their records:

All workers are paid $40 per hour.

LOC applies factory overhead based on direct labor hours.

Sales were $1,000,000.

Cost of goods sold using applied factory overhead was $300,000.

Estimated direct labor hours 150,000

Estimated overhead cost $1,200,000

Actual direct labor cost $ 400,000

Actual overhead cost $ 92,000

Based on this information, gross profit on the income statement is:

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