Reference no: EM132046209

Question - Golden Heaven Ltd. manufactures custom kitchen cabinets and uses a job costing system. On January 1, 2015, there were no balances in work-in-process or finished goods inventories. The following events occurred in January 2015:

1. The company began two jobs: Job CC456 (comprising 40 tables) and Job DD789 (comprising 60 chairs).

2. 400 square metres of timber were purchased at a total cost of $5,800.

3. 80 litres of glue were purchased at a cost of $6 per litre.

4. The following materials were issued during the month:

Issue 1: Job CC456-200 square metres of timber

Issue 2: Job DD789-150 square metres of timber

Issue 3: 20 litres of glue to be used on each job

5. The following number of direct labour hours was spent on the two jobs:

Job CC456: 200 direct labour hours

Job DD789: 100 direct labour hour

Actual direct labour cost per hour was $30.

6. Overhead should be charged to each job on the basis of $25 per direct labour hour.

7. Job CC456 was completed and 30 tables from the job were sold for a total price of $15,000. Job DD789 was unfinished at month-end.

Required:

a. Calculate the inventory value at month-end of

• Raw materials
• Work in process
• Finished goods

b. Calculate both, the cost of goods sold and the gross profit for the month.