Gce Model Questions Vol1 2017 Financial Accounting Question 27

ABC Ltd produces a single product. The following data relate to the year ended 31 December: - Opening raw material stock: £8,000 - Purchases of raw material: £32,000 - Closing raw material stock: £6,000 - Direct labour cost: £24,000 - Manufacturing overhead is applied at \(150\%\) of direct labour cost. - Opening work‑in‑progress (WIP): £5,000 - Closing WIP: £7,500 - Opening finished‑goods stock: £9,000 - Closing finished‑goods stock: £10,800 - Sales revenue: £120,000 - Selling and distribution expenses: £15,000 - Administrative expenses: £10,000 - Actual manufacturing overhead incurred during the year was £35,000. Calculate (a) the cost of goods sold, (b) the gross profit, and (c) the amount of overhead that was over‑ or under‑applied.