D Corporation applies manufacturing overhead to jobs using a predetermined overhead rate of 75% of direct labor cost. Any under of overapplied manufacturing overhead cost is closed out to Cost of Goods Sold at the end of the month. During May, the following transactions were recorded by the company: Raw materials (all direct materials):
Purchased during the month $38,000
Used in production $35,000
Labor:
Direct labor-hours worked during the month 3,150
Direct labor cost incurred $30,000
Manufacturing overhead cost Incurred (total) $24,500
Inventories:
Raw materials (all direct), May 31 $8,000
Work in process, May 1 $9,000
Work in process, May 31 $12,000
Contains $4,400 in direct labor cost.
The Cost of Goods Manufactured for May was:.
a. $84,500.
b. $95,000.
c. $75,500.
d. $81,500.

D Corporation

The Cost of Goods Manufactured for May was:.

a. $84,500.

Explanation:

a) Data and Calculations:

Predetermined overhead rate = 75% of direct labor cost

Raw materials (all direct materials):

Purchased during the month $38,000

Used in production                 $35,000

Labor:

Direct labor-hours worked during the month 3,150

Direct labor cost incurred $30,000

Manufacturing overhead cost Incurred (total) $24,500

Inventories:

Raw materials (all direct), May 31 $8,000

Work in process, May 1 $9,000

Work in process, May 31 $12,000

Contains $4,400 in direct labor cost.

Cost of Goods Manufactured:

Work in process

Beginning balance May 1     $9,000

Raw materials used           $35,000

Direct labor cost incurred $30,000

Overhead applied               22,500

Cost of goods manufactured          $84,500

Work in process, May 31                  $12,000

1) the stages a new product goes through from beginning to end, i.e., the stages that a product passes through from introduction through growth, maturity, and decline. 2) the time from initial research and development to the time at which sales and support of the product to customers are withdrawn. 3) the period of time during which a product can be produced and marketed profitably.

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answer; closing the loop;