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Bodin Company manufactures finger splints for kids who get tendonitis from playing video games. The firm had the following inventories at the beginning and end of the month of January. January 1 January 31Finished goods $ 126,000 $ 117,000 Work in process 235,000 251,000 Raw material 132,000 124,000
The following additional data pertain to January operations.
Raw material purchased $ 192,000 Direct labor 400,000 Actual manufacturing overhead 170,000 Actual selling and administrative expenses 110,000
The company applies manufacturing overhead at the rate of 60 percent of direct-labor cost. Any overapplied or under applied manufacturing overhead is accumulated until the end of the year.
Problem 1: Compute the cost of goods sold for January.
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