Passage for Questions 1-4: The direct labor rate for McGregor's Company is $9.00 per hour, and manufacturing overhead is applied to products using a predetermined overhead rate of $6.00 per direct labor hour. During May, the company purchased $60,000.00 in raw materials (all direct materials) and worked 3,200 direct labor hours. The Raw Materials inventory (all direct materials) decreased by $3,000.00 between the beginning and end of May. The Work in Process inventory on May 1 consisted of one job which had been charged with $4,000.00 in direct materials and on which 300 hours of direct labor time had been worked. There was no Work in Process inventory on May 31.
Question 1. The balance in Work in Process inventory on May 1 was:
A) $0.00
B) $6,700.00
C) $4,500.00
D) $8,500.00
Question 2. The debit to Work in Process for the cost of direct materials used during May was:
A) $63,000.00
B) $61,000.00
C) $57,000.00
D) $67,000.00
Question 3. The debit to Work in Process for direct labor cost during May was:
A) $21,000.00
B) $26,100.00
C) $28,800.00
D) $31,500.00
Question 4. If overhead was underapplied by $2,500.00 during May, the actual overhead cost for the month must have been:
A) $16,700.00
B) $21,700.00
C) $18,500.00
D) $23,500.00.