On December 31, 2013, Barnett Tools has a balance in the Work in Process Inventory account of $62,000. On January 1, 2013, the balance in Work in Process Inventory was $55,000. Current manufacturing costs for the year are $292,000, and cost of goods sold is $284,000. How much is cost of goods manufactured?

Question

Quizplus · Accepted Answer

Cost of goods manufactured = Beginning WIP inventory + Total manufacturing costs - Ending WIP inventory

Ending WIP inventory can be calculated as follows:

Ending WIP inventory = Beginning WIP inventory + Total manufacturing costs - Cost of goods manufactured

Ending WIP inventory = $55,000 + $292,000 - $284,000 = $63,000

Therefore,

Cost of goods manufactured = $62,000 + $292,000 - $63,000 = $291,000

The closest option to this value is D) $285,000, which is the correct answer.

On December 31, 2013, Barnett Tools Has a Balance in the Work