Question

Which of the following costs would a computer manufacturer include in manufacturing overhead? O The wages earned by computer assemblers. O Depreciation on testing equipment. O The cost of the disk drives. O The cost of the memory chips.

Answer 1

Solution 1:

Depreciation on testing equipment would be included in manufacturing overhead by computer manufacturer.

Hence 2nd option is correct.

Solution 2:

Cost of goods sold = Beginning finished goods inventory + Cost of goods manufactured - Ending finished goods inventory

= $60,000 + $850,000 - $50,000 = $860,000

Hence last option is correct.

Solution 3:

Total manufacturing costs = Direct material + Direct labor + Manufacturing overhead

= $190,000 + $120,000 + $170,000 = $480,000

Cost of goods manufactured = Beginning WIP + Manufacturing costs - Ending WIP = $40,000 + $480,000 - $20,000 = $500,000

Hence last option is correct.

Solution 4:

Ending WIP = Beginning WIP + Manufacturing cost - Cost of goods manufactured

= $164,000 + $486,000 - $460,000 = $190,000

Hence first option is correct.