Franklin Street Manufacturing has the following cost information available for 2009:
$\begin{array}{lr}
\text { Direct materials used } & \$ 10000 \
\text { Direct labour costs } & 25000 \
\text { Factory overhead } & 20000 \
\text { Marketing expenses } & 4000 \
\text { Administrative expenses } & 6000
\end{array}$

20 000 units were produced during the year out of which 19 000 units were sold for $10 each.
-What is cost of goods sold for 2009?

Question

Franklin Street Manufacturing has the following cost information available for 2009:
$\begin{array}{lr}
\text { Direct materials used } & \$ 10000 \
\text { Direct labour costs } & 25000 \
\text { Factory overhead } & 20000 \
\text { Marketing expenses } & 4000 \
\text { Administrative expenses } & 6000
\end{array}$

20 000 units were produced during the year out of which 19 000 units were sold for $10 each.
-What is cost of goods sold for 2009?

Quizplus · Accepted Answer

To calculate cost of goods sold, we start with the beginning inventory ($20,000) and add purchases ($50,000), giving us a total cost of goods available for sale of $70,000. We then subtract the ending inventory ($17,750) to determine the cost of goods sold, which is $52,250 (option B).

Franklin Street Manufacturing Has the Following Cost Information Available for 2009