COGM/COGS and Overhead Variance

COGM/COGS and Overhead Variance
The following account balances at the beginning of August were selected from the general ledger of Noah Manufacturing
Company:
Work in process inventory
$0
Raw materials inventory
$26,000
Finished goods inventory
$46,000
Additional data:
1)
Actual manufacturing overhead for August amounted to $62,000.
Total direct labor cost for August was $57,000.
3)
The predetermined manufacturing overhead rate is based on direct labor cost. The budget for the year called for
$300,000 of direct labor cost and $360,000 of manufacturing overhead costs.
4)
The only job unfinished on August 31 was Job No. 1002, for which total direct labor charges were $6,300 (800 direct
labor hours) and total direct material charges were $12,000.
Cost of direct materials placed in production during August totaled $101,000. There were no indirect material
requisitions during August.
6)
August 31 balance in raw materials inventory was $32,000.
"Finished goods inventory balance on August 31 was $34,500
a.
What is the predetermined manufacturing overhead rate?
Est 6H / Est Activity = 3600.00 / 300 000 = 120/. of bL Cost
b.
What is the amount of materials purchased during August?
Raw Materials
Geo RM z60to
find
BB
26 000
RM Used
+ Furchney
Purchlo 100o
– End RM 32006
EB
22 005

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