Alden Company Recorded the Following Transactions for the Just Completed

question 160

Essay

Alden Company recorded the following transactions for the just completed month. The company had no beginning inventories.
(a) $72,000 in raw materials were purchased for cash.
(b) $67,000 in raw materials were requisitioned for use in production. Of this amount, $56,000 was for direct materials and the remainder was for indirect materials.
(c) Total labor wages of $112,000 were incurred and paid in cash. Of this amount, $94,000 was for direct labor and $18,000 was for indirect labor.
(d) Additional manufacturing overhead costs of $108,000 were incurred and paid in cash.
(e) Manufacturing overhead costs of $130,000 were applied to jobs using the company's predetermined overhead rate.
(f) All of the jobs worked on during the month were completed and shipped to customers.
(g) The underapplied or overapplied overhead for the month was closed out to Cost of Goods Sold.
Required:
a. Post the above transactions to T-accounts.
b. Determine the cost of goods manufactured.
c. Determine the cost of goods sold (after closing Manufacturing Overhead).

---

Definitions:

New Technologies

Emerging or recently developed technological advancements, tools, or methods that potentially change existing practices or create new opportunities.

E-Business Strategy

A plan of action for leveraging digital technologies and Internet to conduct a company’s business processes, from procurement to customer service.

Competitive Advantage

The attributes that allow an organization to outperform its competitors, such as superior quality, innovation, or cost efficiency.

Porter's Five Forces

A framework developed by Michael Porter for analyzing the competitive intensity and attractiveness of an industry or market, including competitive rivalry, threat of new entrants, threat of substitutes, bargaining power of buyers, and bargaining power of suppliers.