Question

The information contained in a cost of goods manufactured budget most directly relates to the

A. Materials used, direct labor, overhead applied, and ending work-in-process budgets.
B. Materials used, direct labor, overhead applied, and finished goods inventories budgets.
C. Materials used, direct labor, overhead applied, and work-in-process inventories budgets.
D. Materials used, direct labor, overhead applied, work-in-process inventories, and finished goods inventories budgets.

Answer 1

The correct answer is C

Step-by-step explanation:

Cost of goods manufactured (COGM) also known as the cost of the goods completed, it computes the aggregate value of the inventory which was produced during the year and is ready for sale in the market.

The budgeted amount of COGM is computed in the same way as the actual cost of goods manufactured is computed, except the budgeted amounts, the formula is:

COGM = Direct Labor Used + Direct Materials Used + Manufacturing Overhead applied + Work in Progress Inventories (Beginning WIP inventory + Ending WIP Inventory.