Response to the following problem:
Delta Company had the following inventories at the beginning and end of the month of January.
January 1 January 31
Finished goods $125,000 $117,000
Work in process 235,000 251,000
Raw material 134,000 124,000
The following additional manufacturing data pertains to January operations.
Raw material purchased $191,000
Direct labor 300,000
Actual manufacturing overhead 175,000
Actual selling and administrative expenses 115,000
The Company applies manufacturing overhead at the rate of 60 percent of direct-labor cost. Anyoverapplied or underapplied manufacturing overhead is accumulated until the end of the year.
Required:
1. Compute the company's prime cost for January.
2. Compute the total manufacturing cost for January.
3. Compute the cost of goods manufactured for January.
4. Compute the cost of goods sold for January.
5. Compute the balance in the manufacturing overhead account on January 31. Debit or credit?