ErgoFurn, Inc. manufactures ergonomically designed computer furniture. ErgoFurn uses a job order costing system. On November 30, the Work in Process Inventory consisted of the following jobs:
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| Job No. |
Item |
Units |
Accumulated Cost |
| CC723 |
Computer caddy |
20,000 |
$ 900,000 |
| CH291 |
Chair |
15,000 |
431,000 |
| PS812 |
Printer stand |
25,000 |
250,000 |
| Â |
 |
 |
$1,581,000 |
|
On November 30, ErgoFurn's Raw Materials Inventory account totaled $668,000, and its Finished Goods Inventory totaled $3,456,400. ErgoFurn applies manufacturing overhead on the basis of machine hours. The company's manufacturing overhead budget for the year totaled $4,500,000, and the company planned to use 900,000 machine hours during the year. Through the first eleven months of the year, the company used a total of 830,000 machine hours, total factory overhead amounted to $4,274,500, and Cost of Goods Sold was $8,750,250.ErgoFurn purchased $638,000 in raw materials in December and incurred the following costs for jobs in process that month:
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| Job No. |
Materials Issued |
Machine Hours |
Direct Labor Hours |
Direct Labor Cost |
| CC723 |
$155,000 |
12,000 |
11,600 |
$122,400 |
| CH291 |
$ 13,800 |
4,400 |
3,600 |
$ 43,200 |
| PS812 |
$211,000 |
19,500 |
14,300 |
$200,500 |
| DS444 |
$252,000 |
14,000 |
12,500 |
$138,000 |
|
The following jobs were completed in December and transferred to the Finished Goods Inventory:
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| Job No. |
Item |
Units |
| CC723 |
Computer caddy |
20,000 |
| CH291 |
Chair |
15,000 |
| DS444 |
Desk |
5,000 |
|
Required
| (a) |
Calculate the total cost of each of the four jobs worked on in December. |
| (b) |
Calculate the total manufacturing cost for December. |
| (c) |
Calculate the cost of goods manufactured for December. |
| (d) |
Calculate the balance in the Work in Process Inventory account on December 31. |
| (e) |
Assume that ErgoFurn sold 15,000 computer caddies, 12,000 chairs, and 4,500 desks in December. Calculate Cost of Goods Sold and the ending Finished Goods Inventory balance for December. |
Answers
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