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Jenkins Company had the following information for the year: Jenkins Company used a predetermined overhead rate using estimated overhead of $378,400 and 8,600 estimated direct labor hours. Assume the only inventory balance is an ending Finished Goods Inventory balance of $19,500. What was cost of goods manufactured? $901,600 $907,900 $927,400 $953,800
Expert Answer
Cost of goods manufactured is the total of all the material, labour and overhead cost incurred.
| Jenkins Company | ||
| Statement of Cost of goods manufactured | ||
| For the month ending XX | ||
| Particulars | Amount ($) | Amount ($) |
| Cost of Direct Material Used (given) | 297,700 | |
| Direct Labour Cost | 251,300 | |
| Manufacturing Overhead (9,200*44) | 404,800 | |
| Total manufacturing overhead | 404,800 | |
| Total manufacturing Costs | 953,800 | |
| Add: Beginning Work in Process | 0 | |
| Less: Closing Work in Process (Manufacturing cost minus transferred to finished goods) | 0 | |
| Cost of goods manufactured | 953,800 | |
| Predetermined rate = 378,400/8,600 = $44 per direct labour hour
As there is no opening and closing balance in work in process so Cost of goods amnufactured is D. 953,800 |
