Question

October 1 October 31 Raw materials $ 30,000 $21,000 Work in process 48,000 37,000 Finished goods 108,000 90,000 During October, purchases of direct materials were $36,000. Direct labor and factory overhead costs were $60,000 and $84,000, respectively. What is the cost of goods manufactured

Answer 1

Cost of goods manufactured= $200,000

Step-by-step explanation:

Giving the following information:

October 1 October 31

Raw materials $ 30,000 $21,000

Work in process 48,000 37,000

Direct material purchase= $36,000

Direct labor= $60,000

Factory overhead costs= $84,000

First, we need to calculate the direct material used:

Direct material used= beginning inventory + purchases - ending inventory

Direct material used= 30,000 + 36,000 - 21,000

Direct material used= $45,000

Now, the cost of goods manufactured:

cost of goods manufactured= beginning WIP + direct materials + direct labor + allocated manufacturing overhead - Ending WIP

cost of goods manufactured= 48,000 + 45,000 + 60,000 + 84,000 - 37,000

cost of goods manufactured= $200,000