On May 30, a manufacturing facility of a medium-sized company was severely damaged by an earthquake...
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On May 30, a manufacturing facility of a medium-sized company was severely damaged by an earthquake followed by a fire. As a direct result, the company's direct materials, work-in-process and finished goods inventories were destroyed. Records recovered from the disaster revealed the following incomplete accounting information: 1. Beginning Inventories Direct Materials Work-in-Process Finished Goods 2. May results Net sales Direct materials purchased Direct labor cost 3. Key ratios for this plant: Gross Profit Prime costs Ending WIP Manufacturing Overhead $55,000 $90,000 $25,000 $1,275,000 $550,000 $400,000 20% of net sales 60% of total manufacturing costs 10% of total manufacturing costs 60% of conversion cost Required: Estimate the cost of the inventory lost (RM, WIP & FG) by reconstructing the Cost of Goods Manufactured and Sold report. On May 30, a manufacturing facility of a medium-sized company was severely damaged by an earthquake followed by a fire. As a direct result, the company's direct materials, work-in-process and finished goods inventories were destroyed. Records recovered from the disaster revealed the following incomplete accounting information: 1. Beginning Inventories Direct Materials Work-in-Process Finished Goods 2. May results Net sales Direct materials purchased Direct labor cost 3. Key ratios for this plant: Gross Profit Prime costs Ending WIP Manufacturing Overhead $55,000 $90,000 $25,000 $1,275,000 $550,000 $400,000 20% of net sales 60% of total manufacturing costs 10% of total manufacturing costs 60% of conversion cost Required: Estimate the cost of the inventory lost (RM, WIP & FG) by reconstructing the Cost of Goods Manufactured and Sold report.
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To estimate the cost of the inventory lost raw materials workinprocess and finished goods we need to reconstruct the Cost of Goods Manufactured and So... View the full answer
Related Book For
Managerial Accounting Tools for Business Decision Making
ISBN: 978-1118856994
4th Canadian edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso, Ibrahim M. Aly
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