The cost of goods sold for a manufacturing firm for the month of January was $90,000.The finished goods inventory was $15,000 on January 1 and $17,500 on January 31.Beginning and ending work-in-process inventories were $20,000 and $25,000,respectively.What was the cost of goods manufactured during January?

Question

Quizplus · Accepted Answer

The cost of goods manufactured is calculated using the following formula: Beginning work-in-process inventory + Total manufacturing costs - Ending work-in-process inventory = Cost of goods manufactured. 
Total manufacturing costs = Cost of goods sold + Ending finished goods inventory - Beginning finished goods inventory = $90,000 + $17,500 - $15,000 = $92,500.
Therefore, Cost of goods manufactured = $20,000 + $92,500 - $25,000 = $87,500. 
Hence, the correct answer is Choice C.

The Cost of Goods Sold for a Manufacturing Firm for the Month