Inventory balances for the James Enterprises in February are as follows:
$\begin{array}{lrr}
&\text { February } 1&\text { February } 28\
\text { Raw materials } & \$ 27,000 & \$ 21,000 \
\text { Work in process } & 48,000 & 37,200 \
\text { Finished goods } & 108,000 & 90,000
\end{array}$ During February,purchases of direct materials were $36,000.Direct labour and factory overhead costs were $60,000 and $84,000,respectively.
-Refer to the figure.What are the total manufacturing costs added?
A)$144,000
B)$174,200
C)$180,000
D)$186,000

Question

Quizplus · Accepted Answer

Total manufacturing costs added include direct materials used, direct labor, and factory overhead. Direct materials used = Beginning raw materials + Purchases - Ending raw materials = $27,000 + $36,000 - $21,000 = $42,000. Total manufacturing costs = Direct materials used + Direct labor + Factory overhead = $42,000 + $60,000 + $84,000 = $186,000.

Inventory Balances for the James Enterprises in February Are as Follows