Question

The budgeted finished goods inventory and cost of goods sold for a manufacturing company for the year 2012 are as follows: january 1 finished goods, $765,000; december 31 finished goods, $640,000; cost of goods sold for the year, $2,560,000. the budgeted costs of goods manufactured for the year is?

Answer 1

The answer is $2,435,000

Answer 2

Answer:

Cost of Goods Manufactured is $2,435,000

Explanation:

To compute the costs of goods manufactured,

STEP 1, Compute the total goods available for sale. In order to get the total goods available for sale, we will add the costs of goods sold and the finished goods end (December 31)

Cost of goods sold                                 $2,560,000

Add: Finished goods (December 31)        $640,000

Total goods available for sale                $3,200,000

Finally, Compute the costs of goods manufactured for the year. To get the costs of goods manufactured, we simply deduct the finished goods beginning (January 1) from the total goods available for sale we computed above.

Total goods available for sale                         $3,200,000

Less: Finished goods beginning (January 1)        765,000

COST OF GOODS MANUFACTURE               $2,435,000