Question

GrandSlam Incorporated incurred the following costs during March:

Direct materials: $120,000
Direct labor: $80,000
Factory overhead: $30,000
Selling expenses: $10,000
During the month, 18,100 units of product were manufactured and 10,900 units of product were sold. On March 1, GrandSlam carried no inventory.
What was the cost of goods sold for March?

Answer 1

The cost of goods sold for March can be calculated by subtracting the ending inventory from the cost of goods manufactured.

Step-by-step explanation:

The cost of goods sold for March can be calculated by subtracting the ending inventory from the cost of goods manufactured.

Since GrandSlam carried no inventory on March 1st, the cost of goods manufactured is the sum of direct materials, direct labor, and factory overhead, which is $120,000 + $80,000 + $30,000 = $230,000. To find the cost of goods sold, we need to subtract the ending inventory from the cost of goods manufactured.

To calculate the ending inventory, we can use the following formula: Ending Inventory = Beginning Inventory + Cost of Goods Manufactured - Cost of Goods Sold. Since GrandSlam carried no inventory on March 1st and 10,900 units were sold in March, the cost of goods sold is $230,000 - ($0 + 10,900 * Cost per Unit).