Question

Famous Furniture Manufacturing Company reported the following information for 2019:

Beginning work-in-process inventory $130,000
Beginning raw materials inventory 47,500
Ending work-in-process inventory 112,500
Ending raw materials inventory 60,000
Direct material used 75,000
Direct labor 93,000
Applied manufacturing overhead 70,000
Actual manufacturing overhead cost 62,000

Any underapplied or overapplied manufacturing overhead is closed out to cost of goods sold.

Required:
How much would Famous Furniture Manufacturing report as cost of goods manufactured at year-end?

Answer 1

$255,500

Step-by-step explanation:

Prepare a Cost of Goods Manufactured Schedule to determine the cost of goods manufactured.

Cost of Goods Manufactured Schedule

Direct material used $ 75,000

Direct labor $ 93,000

Applied manufacturing overhead $ 70,000

Add Beginning work-in-process inventory $130,000

Less Ending work-in-process inventory ($112,500)

Cost of goods manufactured $255,500