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The Update Company Does Not Maintain Backup Documents for Its

question 30

Multiple Choice

The Update Company does not maintain backup documents for its computer files.In June,some of the current data were lost,and you have been asked to help reconstruct the data.The following beginning balances on June 1 are known: Reviewing old documents and interviewing selected employees have generated the following additional information: The production superintendent's job cost sheets indicated that materials of $2,600 were included in the June 30 Work-in-Process Inventory.Also,300 direct labor-hours had been paid at $6.00 per hour for the jobs in process on June 30.The Accounts Payable account is only for direct material purchases.The clerk remembers clearly that the balance in the Accounts Payable on June 30 was $8,000.An analysis of canceled checks indicated payments of $40,000 were made to suppliers during June.Payroll records indicate that 5,200 direct labor-hours were recorded for June.It was verified that there were no variations in pay rates among employees during June.Records at the warehouse indicate that the Finished Goods Inventory totaled $16,000 on June 30.Another record kept manually indicates that the Cost of Goods Sold in June totaled $84,000.The predetermined overhead rate was based on an estimated 60,000 direct labor-hours for the year and an estimated $180,000 in manufacturing overhead costs.What is the ending balance in the Work-in-Process Inventory on June 30?

Definitions:

Compounded Quarterly

Interest calculated on an investment or debt four times a year.

Population Decrease

A decline in the number of people living in a specific area, often due to factors like emigration, lower birth rates, or increased mortality rates.

Quarterly Compounded

A method where interest is calculated and added to the principal balance four times a year.

Nominal Interest Rate

The rate of interest before adjustment for inflation, representing the face value of borrowing or lending.