Partridge, Inc. Incurred the Following Costs During March

question 25

Essay

Partridge, Inc. incurred the following costs during March:
Manufacturing overhead is applied on the basis of $8.50 per direct labor hour. Assume that overapplied or underapplied overhead is transferred to cost of goods sold only at the end of the year. During the month, 3,500 units of product were manufactured and 3,400 units of product were sold. On March 1 and March 31, Partridge carried the following inventory balances:
(a.) Prepare a Statement of Cost of Goods Manufactured for the month of March, and calculate the average cost per unit produced.(b.) Calculate the cost of goods sold during March.(c.) Where in the financial statements will the difference between cost of goods manufactured and cost of goods sold be classified?

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Definitions:

Price Makers

Firms or entities that have the power to influence the price of a good or service in the market, typically due to a lack of competition.

Differentiated Products

Products that are similar but distinguished from each other by variations in quality, features, branding, or some other aspect valued by consumers.

Short Run

A period in which at least one input (e.g., capital) is fixed and cannot be changed.

Long Run

A period of time in economics during which all factors of production and costs are variable, allowing for full adjustment to change.