Question

Kushman Combines, Inc. has $20,000 of ending finished goods inventory as of December 31, 2013. If beginning finished goods inventory was $10,000 and cost of goods sold was $50,000, how much would Kushman report for cost of goods manufactured?

Answer 1

Kushman would report $60,000 for cost of goods manufactured

Step-by-step explanation:

Cost of Goods Sold is a direct cost of selling an item.

Cost of Goods Sold = Beginning finished goods inventory + Cost of goods manufactured - Ending finished goods inventory

Making the Cost of goods manufactured as a subject of formula the calculation will be as follows :

Cost of goods manufactured = Cost of Goods Sold+Ending finished goods inventory-Beginning finished goods inventory

Therefore,

Cost of goods manufactured= $50,000+$20,000- $10,000

= $60,000