Jose Corporation makes bottles using the latest automated technology. The company applies Factory Overhead cost to products on the basis of machine hours. The following are estimates used to determine the factory overhead rates at the start of the year. Machine Hours 150,000 Factory Overhead Cost 1,800,000 The company cost records show the following actual cost incurred for the year. Machine Hours 120,000 Factory Overhead Cost 1,700,000 Raw Materials 60,000 Work in Process (includes Factory Overhead applied of $72,000) 200,000 Finished Goods (includes Factory Overhead applied of $360,000) 1,000,000 Cost of Goods Sold (includes Factory Overhead applied of $1,008,000) 2,800,000 Required: Assume the variance is material, what is the adjustment of the Cost of Goods Sold?
Jose Corporation makes bottles using the latest automated technology. The company applies Factory Overhead cost to products on the basis of machine hours. The following are estimates used to determine the factory overhead rates at the start of the year. Machine Hours 150,000 Factory Overhead Cost 1,800,000 The company cost records show the following actual cost incurred for the year. Machine Hours 120,000 Factory Overhead Cost 1,700,000 Raw Materials 60,000 Work in Process (includes Factory Overhead applied of $72,000) 200,000 Finished Goods (includes Factory Overhead applied of $360,000) 1,000,000 Cost of Goods Sold (includes Factory Overhead applied of $1,008,000) 2,800,000 Required: Assume the variance is material, what is the adjustment of the Cost of Goods Sold?
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter4: Accounting For Factory Overhead
Section: Chapter Questions
Problem 10E: Compute the total job cost for each of the following scenarios: a. If the direct labor cost method...
Related questions
Question
Jose Corporation makes bottles using the latest automated technology. The company applies
Machine Hours |
150,000 |
Factory Overhead Cost |
1,800,000 |
The company cost records show the following actual cost incurred for the year.
Machine Hours |
120,000 |
Factory Overhead Cost |
1,700,000 |
Raw Materials |
60,000 |
Work in Process (includes Factory Overhead applied of $72,000) |
200,000 |
Finished Goods (includes Factory Overhead applied of $360,000) |
1,000,000 |
Cost of Goods Sold (includes Factory Overhead applied of $1,008,000) |
2,800,000 |
Required:
- Assume the variance is material, what is the adjustment of the Cost of Goods Sold?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
Recommended textbooks for you
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning