Answer:
a. Purchases $310,000
b. Direct labor $ 238,125
c. Cost of goods manufactured $ 736,000
d. Cost of goods sold $ 716,000
Explanation:
Cascade Manufacturing Company
Raw materials used ..... $300,000
Add Raw materials Ending ...... $80,000
Less Raw materials Beginning...... $70,000
a. Purchases $310,000
Add Raw materials Ending to Raw materials used and subtract Raw materials Beginning to get Raw materials Purchases.
Total manufacturing costs $ 681,000
Less Raw materials used ..... $300,000
Conversion Costs $ 381,000
Conversion Costs = Direct Labor + Factory Overhead
$ 381,000= x + 0.6 x
$ 381,000= 1.6x
b. x= Direct labor = $ 381,000/1.6= $ 238,125
Factory Overhead= 0.6 *$ 238,125= $ 142875
Find Conversion Costs and then apply the ratio to get the direct labor costs.
c.
Cascade Manufacturing Company
Cost of goods manufactured
Raw materials Beginning...... $70,000
Add Purchases $310,000
Less Raw materials Ending ...... $80,000
Raw materials used ..... $300,000
Add Direct labor $ 238,125
Factory Overhead $ 142875
Total manufacturing costs $ 681,000
Add Work-in-process Beginning...... 85,000
Cost of goods available for manufacture $ 766,000
Less Work-in-process Ending...... 30,000
Cost of goods manufactured $ 736,000
Add and subtract as above to get the Cost of goods manufactured.
d. Cascade Manufacturing Company
Cost of goods sold
Raw materials Beginning...... $70,000
Add Purchases $310,000
Less Raw materials Ending ...... $80,000
Raw materials used ..... $300,000
Add Direct labor $ 238,125
Factory Overhead $ 142875
Total manufacturing costs $ 681,000
Add Work-in-process Beginning...... 85,000
Cost of goods available for manufacture $ 766,000
Less Work-in-process Ending...... 30,000
Cost of goods manufactured $ 736,000
Add Finished goods Beginning...... 90,000
Cost of goods available for sale $ 826,000
Less Finished goods Ending....... 110,000
Cost of goods sold $ 716,000
Add and subtract as above to get the Cost of goods sold.
