The balance in the Finished Goods Inventory account on July 31, 2017, was $41,000 and the June 30, 2017, balance in the Finished Goods Inventory account was $34,000.Cost of goods sold is $200,000 and direct materials used in production total $86,000.How much is cost of goods manufactured?

Question

Quizplus · Accepted Answer

We can use the following formula to calculate cost of goods manufactured:

Beginning Finished Goods Inventory + Cost of Goods Manufactured - Ending Finished Goods Inventory = Cost of Goods Sold

Plugging in the given information:

$34,000 (Beginning Finished Goods Inventory) + Cost of Goods Manufactured - $41,000 (Ending Finished Goods Inventory) = $200,000 (Cost of Goods Sold)

Solving for Cost of Goods Manufactured:

Cost of Goods Manufactured = $207,000

The Balance in the Finished Goods Inventory Account on July