Question

The financial records for the Harrison Manufacturing Company have been destroyed in a fire. The following information has been obtained from a separate set of books maintained by the cost accountant. The cost accountant now asks for your assistance in computing the missing amounts.

Direct Materials Inventory
Beg. Bal. 8,200 ? Transferred Out
Purchases ?
End. Bal. 6,600
Cost of Goods Sold
59,000
Work-in-Process Inventory
Beg. Bal. 7,700 ? Transferred Out
Materials 18,400
Labor 13,700
Overhead 8,200
End. Bal. ?
Finished Goods Inventory
Beg. Bal. ? ? Transferred Out
Transferred in 39,700
End. Bal. 4,400
What is the value of the ending Work-in-Process inventory balance?
a. $4,400.
b. $0.
c. $8,200.
d. $8,300.

Answer 1

d. $8,300.

Step-by-step explanation:

Direct Materials

Beginning 8,200

Purchases *16,800

Requisitions 18,400

Ending 6,600

We solve for purchases:

6,600 + 18,400 - 8,200 = 16,800

WIP Inventory

Beginning 7,700

Materials 18,400

Labor 13,700

Overhead 8,200

Transferred Out 39,700*

Ending 8,300

The transferred-out from WIP inventory is the transferred-in for Finished Goods