It is estimated that direct materials, direct labour and factory overhead for the period will total $500 000. If work in process at the start is $35 000 and estimated work in process at the end is $40 000, the cost of goods manufactured is:
A) $495 000.
B) $250 000.
C) $350 000.
D) $505 000.

Question

Quizplus · Accepted Answer

The cost of goods manufactured is calculated by adding the total manufacturing costs to the beginning work in process inventory and then subtracting the ending work in process inventory. So, $500,000 (total manufacturing costs) + $35,000 (beginning work in process) - $40,000 (ending work in process) = $495,000.

It Is Estimated That Direct Materials, Direct Labour and Factory