Question

The following data apply to Fantastic Chairs Ltd

Work in process inventory, beginning of the year $ 60 000

Manufacturing overhead applied during the year $ 90 000

Work in process inventory, end of the year $ 70 000

Finished goods inventory, beginning of the year $ 50 000

Finished goods inventory, end of the year $ 35 000

Estimated cost of goods sold during the year $ 420 000

Calculate the cost of goods manufactured during the year. A. $420 000 B. $405 000 C. $385 000 D. $370 000

Answer 1

Answer is option B $405000

Cost of goods sold = beginning finished inventory + cost of goods manufactured - ending finished inventory

Cost of goods manufactured= cost of goods sold- beginning finished inventory + ending finished inventory

=420000+35000-50000=405000

Answer 2

To calculate the cost of goods manufactured during the year, we need to consider the changes in the work in process inventory.

The formula to calculate the cost of goods manufactured is:

Cost of Goods Manufactured = Work in Process Inventory, beginning of the year + Manufacturing overhead applied during the year - Work in Process Inventory, end of the year

Given: Work in process inventory, beginning of the year = $60,000 Manufacturing overhead applied during the year = $90,000 Work in process inventory, end of the year = $70,000

Using the formula, we can calculate the cost of goods manufactured:

Cost of Goods Manufactured = $60,000 + $90,000 - $70,000 Cost of Goods Manufactured = $80,000

Therefore, the cost of goods manufactured during the year is $80,000. None of the provided answer options match this result