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Managerial Accounting: The Corners...

7th Edition
Maryanne M. Mowen + 2 others
ISBN: 9781337115773

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BuyFindarrow_forward

Managerial Accounting: The Corners...

7th Edition
Maryanne M. Mowen + 2 others
ISBN: 9781337115773
Textbook Problem
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Use the following information for Exercises 2-45 and 2-46:

In September, Lauren Ashley Company purchased materials costing $200,000 and incurred direct labor cost of $120,000. Overhead totaled $325,000 for the month. Information on inventories was as follows:

Chapter 2, Problem 45E, Use the following information for Exercises 2-45 and 2-46: In September, Lauren Ashley Company

Exercise 2-45 Direct Materials Used, Cost of Goods Manufactured

Refer to the information for Lauren Ashley above.

Required:

  1. 1. What was the cost of direct materials used in September?
  2. 2. What was the total manufacturing cost in September?
  3. 3. What was the cost of goods manufactured for September?

1.

To determine

Calculate the amount of cost of direct materials in September.

Explanation

Direct Material Used In Production:

Direct material used in production is the variance between the amount of materials used for production and the amount of purchased materials.

Use the following formula to compute the direct materials used in production:

Direct materials used in production=(Begining inventory of materials+PurchasesEnding inventory of materials)

2.

To determine

Calculate the amount of total manufacturing cost in September.

3.

To determine

Calculate the amount of cost of goods manufactured in September.

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