Question

Consider Derek's budget information: materials to be used totals $62,100; direct labor totals $198,200; factory overhead totals $403,100; work in process inventory January 1 is $187,500; and work in progress inventory on December 31 is $195,000. The budgeted cost of goods manufactured for the year is

Answer 1

Answer:

Cost of goods manufactured  655,900

Explanation:

First, we add the three cost component:

materials used in production                 62,100

direct labor                                            198,200

overhead                                               403,100

total cost added during the period    663,400

Then, using the WIP beginning and ending figures, we solve for cost of goods manufactured

WIP         january 1st                 187,500

cost added                              663,400

WP endind                             (195,000)  

Cost of goods manufactured  655,900