Question

The Fabricating Department started the current month with a beginning Work in Process inventory of $10,000. During the month, it was assigned the following costs: direct materials, $76,000; direct labor, $24,000; and factory overhead, 50% of direct labor cost. Also, inventory with a cost of $109,000 was transferred out of the department to the next phase in the process.

The ending balance of the Work in Process Inventory account for the Fabricating Department is:

A. $13,000.B. $56,000.C. $59,000.D. $110,000.E. $165,000.

Answer 1

A.$13,000

Step-by-step explanation:

The computation of ending balance is shown below:-

Factory overhead = $24,000 × 50%

= $12,000

Total cost = Direct material + Direct labor + Factory overhead + Current period cost + Opening work in progress

= $76,000 + $24,000 + $12,000 + $10,000

= $122,000

Ending work in progress = Total cost - Cost of units transferred

= $122,000 - $109,000

= $13,000