ACC - Cost Accounting Problem

Materials:

Beginning inventory $30,000
Purchases $400,000
Ending Inventory $50,000

Work-In-Process:

Beginning Inventory $20,000
Direct labor $360,000
Ending Inventory $300,000

Finished Goods:

Beginning Inventory $10,000
Ending Inventory $50,000

MOH actual: $540,000

Additional Information:

a) Direct Labor wage rate was $15 per hour
b) MOH was allocated at $20 per direct labor hour
c) Sales revenue was $1,090,000
d) Marketing and Distribution costs were $140,000

Required:

1- Calculate the over or under applied manufacturing overhead.

2- Determine the cost of goods manufactured.

3- Determine the cost of goods sold

4- Prepare income statement using the direct write-off method and the Proration method