Savard Corporation reported the following:
Raw material purchases totaling $100,000.
Raw material inventory increased $5,000.
Direct labor costs incurred totaled $150,000.
Total factory overhead was $225,000.
Work in process increased $20,000.
Indirect labor was $7,000.
Finished goods increased $40,000.
Sales salaries were $75,000.
How much was Savard's cost of goods manufactured?
A) $450,000
B) $490,000
C) $457,000
D) $497,000

Question

Quizplus · Accepted Answer

Cost of goods manufactured = Raw material purchases + Direct labor costs + Total factory overhead - Increase in raw material inventory - Increase in work in process + Increase in finished goods= $100,000 + $150,000 + $225,000 - $5,000 - $20,000 + $40,000= $450,000

Savard Corporation Reported the Following