Question

Suppose Cook Pro manufactures cast iron skillets One model is a 10-inch skillet that sells for $36 Cook Pro projects sales of 725 10-inch skies per month The production costs are $11 per stillet for direct materials. 53 perskillet for direct labor and $4 perskillet for manufacturing overhead Cook Pro has 25 10-inch e s in inventory at the beginning of My but wants to have an ending inventory equal to 35% of the next month's sales Selling and administrative expenses for this product line are $1.000 per month Cook Pro is budgeted to produce 954 skills in July with a 518 production cost per skillet Compute the budgeted cost of goods sold for July O A $17.172 OB. $17.622 OC. $14056 OD. $13,050

Answer 1

units in beginning inventory = 25

units produced and sold during July = 725 - 25 = 700

cost of goods sold for July = cost of beginning inventory sold + cost of units produced and sold during July

cost of goods sold for July = (25 * $18) + (700 * $18)

cost of goods sold for July = $450 + $12,600

cost of goods sold for July = $13,050

hence, the correct answer is D. $13,050