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Fenwick corporations manufacturing and finished goods

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Fenwick Corporation's manufacturing and finished goods warehouse facilities burned to the ground on January 31. The loss was fully covered by insurance. The insurance company wanted to know the cost of the inventories destroyed in the fire. The company's accountants gathered the following information:


  Direct materials purchased in January $ 160,000
  Work in Process Inventory, January 1
34,000
  Materials Inventory, January 1
16,000
  Finished Goods Inventory, January 1
30,000
  Direct labor costs incurred in January
190,000
  Prime costs charged to jobs in January
294,000
  Cost of finished goods available for sale in January
450,000
  Sales revenue earned in January
500,000
  Gross profit as a percentage of January sales
25 %
  Manufacturing overhead applied to jobs in January as a      percentage of total conversion costs
60 %
  

Assume that actual manufacturing overhead was exactly equal to the amount applied to production at the time of the fire.
a.

Compute the cost of materials inventorylost in the fire.
  
  Materials inventory $
  
b. Compute the cost of work in process inventory lost in the fire.
  
  Work in process inventory $
  
c. Compute the cost of finished goods inventory lost in the fire.
  
  Finished goods inventory $

Reference no: EM13573558

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