Primare Corporation Cost of Goods Sold:
Raw materials:
Beginning Inventory $12,000
Purchase 30,000
Ending Inventory (18,000)
Cost of raw materials $24,000
Direct labor 58,000
Beginning Work in process 56,000
Ending Work in process (65,000)
Manufacturing overhead 87,000
Cost of goods produced $160,000
Beginning Finished goods 35,000
Ending Finished goods (42,000)
Under applied overhead 4,000
Cost of goods sold $157,000
Reason :
a) Data and Calculations:
Raw materials purchase $ 30,000
Direct labor $ 58,000
Manufacturing overhead $ 87,000
Under applied overhead $ 4,000
Inventories Beginning Ending
Raw materials $ 12,000 $ 18,000
Work in process 56,000 65,000
Finished goods 35,000 42,000
b) The cost of goods sold is the addition of the cost of production with the beginning inventory of finished goods and the ending inventory of finished goods. The under applied overhead is added to the cost of goods sold.
Finished goods :
Finished goods are inventory items unique to manufacturers. As retailers purchase their inventory in completed form, there's no need to categorize or segment their inventory. Goods and products that have been purchased ready for sale are known as merchandise.
Learn more about Finished goods :
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