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15 February, 20:01

Venus Crates manufactures custom crates for a variety of uses. The following data have been recorded for Job 551, which was recently completed. Direct materials used cost $7,700. There were 90 machine hours used on this job. The predetermined overhead rate is $32 per machine hour used. There were 179 direct labor hours worked on this job at a direct labor wage rate of $31 per hour. What is the total manufacturing cost of Job 551?

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  1. 15 February, 20:24
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    Cost of goods manufactured = $16,129

    Explanation:

    Total manufacturing cost is the aggregate amount of cost incurred by a business to produce goods in a reporting period.

    Generally accepted accounting principles require that the cost of goods sold shall consist of:

    the cost of direct materials

    the cost of direct labor

    the cost of manufacturing overhead

    In this exercise:

    Cost of goods manufactured:

    Direct materials = $7,700

    Direct Labor=179hours * $31=$5,549

    Factory overhead = $32*90 hours = $2,880

    Total = $16,129
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