34) On January 1, 2014, Maywood Inc. Work-in-Process Inventory account had a bal

Question

34) On January 1, 2014, Maywood Inc. Work-in-Process Inventory account had a balance of $30,000. During 2014, $58,000 of direct materials was placed into production. Manufacturing wages incurred amounted to $84,000, of which $66,000 were for direct labor. Manufacturing overhead is allocated on the basis of 120% of direct labor cost. Actual manufacturing overhead was $90,000. Jobs costing $220,400 were completed during 2014, What is the December 31, 2014 balance of Work-in-Process Inventory? A) $6,000 B) $12,800 C) $34,800 D) $16,800

Explanation / Answer

Ending Work in process Inventory = beginning WIP + Direct Material + Direct Labor + Manufacturing Overhead applied - Cost of good completed & transfered to finished goods

Ending Work in process Inventory = 30000 + 58000 + 66000 + 120%*66000 - 220400

Ending Work in process Inventory = $ 12800

Answer

B) $ 12800

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