MOB Corp Maintains an Internet-Based General Ledger

question 111

Essay

MOB Corp. maintains an internet-based general ledger. Overhead is applied on the basis of direct labor costs. Its bookkeeper accidentally deleted most of the entries that had been recorded for January. A printout of the general ledger (in T-account form) showed the following: A review of the prior year's financial statements, the current year's budget, and January's source documents produced the following information:
(1) Accounts Payable is used for raw material purchases only. January purchases were $49,000.
(2) Factory overhead costs for January were $17,000 none of which is indirect materials.
(3) The January 1 balance for finished goods inventory was $10,000.
(4) There was a single job in process at January 31 with a cost of $2,000 for direct materials and $1,500 for direct labor.
(5) Total cost of goods manufactured for January was $90,000.
(6) All direct laborers earn the same rate ($13/hour). During January, 2,500 direct labor hours were worked.
(7) The predetermined overhead rate is based on direct labor costs. Budgeted (expected) overhead for the year is $195,000 and budgeted (expected) direct labor is $390,000.
Fill in the missing amounts a through o above in the T-accounts above.

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Definitions:

Credit Bureau

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Equal Credit Opportunity Act

A US federal law that prohibits discrimination by lenders against borrowers based on race, color, religion, national origin, sex, marital status, or age.

Class Action Lawsuit

A lawsuit in which one or more people sue a company or other legal entity that allegedly wronged all of them in the same way.