Module 1: Chapter 2: Cost Flow
(To be posted as a group assignment in your group discussion area)
The following information for Transcontinental Inc. is provided. Use this information to answer the succeeding eight questions:

Materials Inventory (Jan. 1) $33,500
Work-in-process Inventory (Jan. 1) $28,100
Finished Goods Inventory (Jan. 1) $36,700
Cost of materials purchased $192,000
Total direct labor costs $168,300
Depreciation – factory machinery $36,200
Small tools expense $8,100
Office supplies $13,400
Machine helpers wages $48,500
Miscellaneous factory expenses $19,600
Presidents salary $125,000
Power - factory $27,100
Factory insurance expense $10,600
Factory supervisors salary $39,500
Sales and advertisement $18,000
Power-office $11,200
Depreciation – office equipment $8,500
Materials inventory (Dec. 31) $28,200
Work-in-process inventory (Dec. 31) $34,700
Finished Goods Inventory (Dec. 31) $13,900

The sales for Transcontinental Inc. during this year were $1,050,000 and a total of 4,800 units were completed during the year. Compute the following for the year:

1. Cost of materials used? _$197,300____ [Cost of Material Purchased + (Difference between Material Inventory Jan 1 - Material Inventory Dec 31)]

2. Factory overhead? ___$189,600____ [Depreciation – factory machinery + Small tools expense + Machine helpers wages + Miscellaneous factory expenses + Power – factory + Factory insurance expense+ Factory Supervisor Salary] …..All other costs are Administrative overhead and not Factory Overhead

3. Total manufacturing cost? $_555,200__ [Cost of Material Used + Factory Overhead + Direct Labor Cost]

4. Cost of goods manufactured? _$548,600___ [Total manufacturing cost + (Difference between Work-in-process inventory Jan 1 - Work-in-process