On January 1, 2015, Frederic Manufacturing had a beginning balance in Work-in-Process Inventory of $160,000 and a beginning balance in Finished Goods Inventory of $20,000. During the year, Frederic incurred manufacturing costs of $200,000. During the year, the following transactions occurred:
Job C-62 was completed for a total cost of $140,000 and was sold for $155,000.
Job C-63 was completed for a total cost of $180,000 and was sold for $210,000.
Job C-64 was completed for a total cost $80,000 but was not sold as of year-end.
The Manufacturing Overhead account had an unadjusted credit balance of $24,000, and was cleared to zero at year-end.
What was the final balance in the Cost of Goods Sold account?

Question

Quizplus · Accepted Answer

The Cost of Goods Sold includes the cost of jobs that were completed and sold. Job C-62 and Job C-63 were sold, with costs of $140,000 and $180,000 respectively. Therefore, the Cost of Goods Sold is $140,000 + $180,000 = $320,000. However, the unadjusted credit balance in Manufacturing Overhead of $24,000 needs to be subtracted, resulting in a final balance of $296,000.

On January 1, 2015, Frederic Manufacturing Had a Beginning Balance