Sony manufacturers the Walkman, a mobile tape player that provides a new way to enjoy music...

 

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Sony manufacturers the Walkman, a mobile tape player that provides "a new way to enjoy music in high quality anywhere at any time." Sony uses a job order costing system and allocates actual manufacturing overhead to production. The following information was provided by the company for the year ended December 31, 1985: Beginning Raw Materials Inventory $375,000 Ending Raw Materials Inventory $435,000 Direct Factory Labor $185,000 Indirect Factory Labor $35,000 Indirect Materials $15,000 Building Utilities* $44,000 Other Selling, General, and Administrative $75,000 Expenses Building Depreciation* $300,000 *80% of the building is devoted to production; 20% of the building is devoted to selling and administrative functions. In addition to the above information, $531,000 raw materials were purchased during the period. Sony's beginning and ending Work in Process inventories were $245,000 and $290,000, respectively. The net increase in the Company's finished goods inventories during the period was $25,000. Raw materials contains both direct and indirect materials. Calculate Operating Income assuming a sales level of $1,500,000. Sony manufacturers the Walkman, a mobile tape player that provides "a new way to enjoy music in high quality anywhere at any time." Sony uses a job order costing system and allocates actual manufacturing overhead to production. The following information was provided by the company for the year ended December 31, 1985: Beginning Raw Materials Inventory $375,000 Ending Raw Materials Inventory $435,000 Direct Factory Labor $185,000 Indirect Factory Labor $35,000 Indirect Materials $15,000 Building Utilities* $44,000 Other Selling, General, and Administrative $75,000 Expenses Building Depreciation* $300,000 *80% of the building is devoted to production; 20% of the building is devoted to selling and administrative functions. In addition to the above information, $531,000 raw materials were purchased during the period. Sony's beginning and ending Work in Process inventories were $245,000 and $290,000, respectively. The net increase in the Company's finished goods inventories during the period was $25,000. Raw materials contains both direct and indirect materials. Calculate Operating Income assuming a sales level of $1,500,000.

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Sony Walkman Operating Income Calculation 1985 Job Order Costing with Actual Overhead Allocation We ... View the full answer