The following information appears on the income statement of the Richer Company at the end of the year. Cost of Goods Manufactured was:

Question

The following information appears on the income statement of the Richer Company at the end of the year.  Cost of Goods Manufactured was:

Quizplus · Accepted Answer

The Cost of Goods Manufactured is calculated by adding the total manufacturing costs (direct materials used, direct labor incurred, and manufacturing overhead incurred) to the beginning work in process inventory and subtracting the ending work in process inventory. 
From the given information on the income statement, we can see the following figures:
- Direct materials used: $65,000
- Direct labor incurred: $80,000
- Manufacturing overhead incurred: $119,000
- Beginning work in process inventory: $28,000
- Ending work in process inventory: $8,000
Using the formula: Cost of Goods Manufactured = Direct materials used + Direct labor incurred + Manufacturing overhead incurred + Beginning work in process inventory - Ending work in process inventory, we get:
Cost of Goods Manufactured = $65,000 + $80,000 + $119,000 + $28,000 - $8,000 = $284,000
Therefore, the closest answer among the options is C, which is $264,000.

The Following Information Appears on the Income Statement of the Richer