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-   -   How to calculate direct labor cost if it is not given (https://www.askmehelpdesk.com/showthread.php?t=507896)

  • Sep 15, 2010, 02:34 PM
    dmccoy
    How to calculate direct labor cost if it is not given
    What is given
    Cost of goods sold for the month ended July 31 was $345,000
    Beginning inventories, July 1
    Direct materials $20,000
    Work in process $40,000
    Finished goods $102,000
    Purchases of direct materials during July $110,000
    Ending invertories, July 31
    Direct mateirals $26,000
    Work in process 36,000
    Finished goods $105,000

    What is the
    Direct labor
    Factory overhead
    Total manufacturing cost
    Factory overhead was 50% of the direct labor cost
  • Sep 16, 2010, 12:01 AM
    morgaine300

    Make yourself up some t accounts for your 3 inventories and plug in those beginning and ending balances.

    Then take the other info and plug it in where it belongs. (Like materials purchases is a debit to the materials.) This way you can discover where you can solve for a missing number. Remember these are all debit accounts, so we debit into them, and credit out of them.

    Once you have one of your missing numbers, that can be plugged in somewhere else, allowing you to solve for yet another number, and so on.

    Give that a crack and see where you get. If you have questions, please ask some specific ones since it's difficult to just tell you the whole problem without just doing it for you.

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