Question $3-$ Chapter $15-$ Hon

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Chapter $15-$ Homework $($i$)$

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$3$

$10$ points

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Butrico Manufacturing Corporation uses a standard cost system, records materials price variances when direct materials are purchased, and prorates all variances at year$-$end. Variances associated with direct materials are prorated based on the balances of direct materials in the appropriate accounts, and variances associated with direct labor and manufacturing overhead are prorated to Finished Goods Inventory and to Cost of Goods Sold $($COGS$)$ on the basis of the relative direct labor cost in these accounts at yearend.

The following information is for the year ended December $31$:

The company had no beginning inventories and no ending Work$-$in$-$Process $($WIP$)$ Inventory. It applies manufacturing overhead at $80\%$ of standard direct labor cost.

Finished goods inventory at $12/31$:

Direct materials $$97,440$

Direct labor $146,160$

Applied manufacturing overhead $116,928$

Direct materials inventory at $\frac{12}{31}$

Cost of goods sold for the year ended $12/31$:

Direct materials

Direct labor

Applied manufacturing overhead

Direct materials price variance $($unfavorable$)11,200$

Direct materials usage variance $($favorable$),16,800$

$\backslash$table$[[$Direct labor rate variance $($unfavorable$),22,400],[,600,]]$

Direct labor efficiency variance $(favorable)5,600$

Actual manufacturing $772,800$

Actual manufacturing overhead incurred

Check my work

Required:

Compute the amount of Direct Materials Price Variance to be prorated to Finished Goods Inventory at December $31.$

Compute the total amount of direct materials cost in the Finished Goods Inventory at December $31,$ after all materials variances have been prorated.

Compute the total amount of direct labor cost in the Finished Goods Inventory at December $31,$ after all variances have been prorated.

Compute the total Cost of Goods Sold $($COGS$)$ for the year ended December $31,$ after all variances have been prorated.

$($For all requirements, round your final answers to the nearest whole dollar amount.$)$

Required:

$1.$ Compute the amount of Direct Materials Price Variance to be prorated to Finished Goods Inventory at December $31.$

$2.$ Compute the total amount of direct materials cost in the Finished Goods Inventory at December $31,$ after all materials variances have been prorated.

$3.$ Compute the total amount of direct labor cost in the Finished Goods Inventory at December $31,$ after all variances have been prorated.

$4.$ Compute the total Cost of Goods Sold $($COGS$)$ for the year ended December $31,$ after all variances have been prorated.