Leak Enterprises LLC recorded the following transactions for the just completed month. The company had no beginning inventories.(1) Raw materials purchased for cash, $96,000(2) Direct materials requisitioned for use in production, $69,000(3) Indirect materials requisitioned for use in production, $22,000(4) Direct labor wages incurred and paid, $129,000(5) Indirect labor wages incurred and paid, $16,000(6) Additional manufacturing overhead costs incurred and paid, $121,000(7) Manufacturing overhead costs applied to jobs, $163,000(8) All of the jobs in process were completed.(9) All of the completed jobs were shipped to customers.(10) Any underapplied or overapplied overhead for the period was closed out to Cost of Goods Sold.Use the following T-accounts to answer the following question. The adjusted cost of goods sold for the month is:
A) $335,000
B) $361,000
C) $357,000
D) $365,000

Question

Leak Enterprises LLC recorded the following transactions for the just completed month. The company had no beginning inventories.(1) Raw materials purchased for cash, $96,000(2) Direct materials requisitioned for use in production, $69,000(3) Indirect materials requisitioned for use in production, $22,000(4) Direct labor wages incurred and paid, $129,000(5) Indirect labor wages incurred and paid, $16,000(6) Additional manufacturing overhead costs incurred and paid, $121,000(7) Manufacturing overhead costs applied to jobs, $163,000(8) All of the jobs in process were completed.(9) All of the completed jobs were shipped to customers.(10) Any underapplied or overapplied overhead for the period was closed out to Cost of Goods Sold.Use the following T-accounts to answer the following question.       The adjusted cost of goods sold for the month is:
A) $335,000 
B) $361,000 
C) $357,000 
D) $365,000

Quizplus · Accepted Answer

To calculate the adjusted cost of goods sold, we first need to calculate the total manufacturing costs incurred during the month by adding up the direct materials used, direct labor incurred, and manufacturing overhead applied.
Total manufacturing costs = Direct materials + Direct labor + Applied overhead
Total manufacturing costs = $69,000 + $129,000 + $163,000 = $361,000

Next, we need to account for any underapplied or overapplied overhead. In this case, we are told that any such amounts were closed out to Cost of Goods Sold. Therefore, we need to adjust our total manufacturing costs by this amount.
Adjusted cost of goods sold = Total manufacturing costs +/- Underapplied or overapplied overhead
Adjusted cost of goods sold = $361,000 + $0 (since there is no information given about underapplied or overapplied overhead) = $361,000

Therefore, the adjusted cost of goods sold for the month is $357,000 (Choice C).

Leak Enterprises LLC Recorded the Following Transactions for the Just