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3 votes
Beg. of Year

End of Year

Raw Materials Inventory

$26000

$30852

Work in process inventory

$35000

$32867

Finished goods inventory

$14000

$28862

Purchases of DM

$73000

Direct Labor

$41484

Indirect Labor

$40000

Insurance on plant

$10000

Depreciation - plant building and equipment

$12747

Repairs and maintenance - plant

$4869

Marketing expenses

$76000

General & administrative expenses

$27354

What is Cost of Goods Sold?

1 Answer

6 votes

Answer: $164,519

Step-by-step explanation:

Direct Material used = Beg. Raw Materials Inventory + Purchases of DM - End. Raw Materials Inventory

= $26000 + $73000 - $30852

= $68,148

Direct labor cost = $41,484

Manufacturing overhead = Indirect Labor + Insurance on plant + Depreciation - plant building and equipment + Repairs and maintenance - plant

= $40000 + $10,000 + $12747 + $4869

= $67,616

Total manufacturing cost = Direct Material used + Direct labor cost + Manufacturing overhead

= $68,148 + $41,484 + $67,616

= $177,248

Cost of goods manufactured:

= Total manufacturing cost + Beg. Work in process inventory - End. Work in process inventory

= $177,248 + $35000 - $32867

= $179,381

Cost of goods sold = Cost of goods manufactured + Beg. Finished goods inventory - End. Finished goods inventory

= $179,381 + $14000 - $28862

= $164,519

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