Raw materials inventory, January 1 $20,000 Raw materials inventory, December 31
ID: 2450651 • Letter: R
Question
Raw materials inventory, January 1 $20,000
Raw materials inventory, December 31 10,000
Work in process inventory, January 1 6,000
Work in process inventory, December 31 9,000
Finished goods inventory, January 1 16,000
Finished goods inventory, December 31 20,000
Raw materials purchases 400,000
Direct labor 200,000
Factory utilities 75,000
Indirect labor 45,000
Factory depreciation 180,000
Selling & administrative expenses 210,000
Assume goods manufactured is $870,000.
The cost of goods sold is:
a. $866,000.
b. $874,000.
Explanation / Answer
Opening Raw Materials 20000 Add: Purchases 400000 Less: Closing Stock 10000 Raw Materials consumed 410000 Add: Direct Labour 200000 Prime Cost 610000 Add: Work in Process Opening 16000 Less: Work in Process Closing 9000 Add: Factory Utilities 75000 Depreciation 180000 Indirect Labour 45000 917000
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