Answer:
Option (c) is correct.
Explanation:
Given that,
Materials to be used = $64,750;
Direct labor = $198,400;
Factory overhead = $394,800;
Work in process inventory on January 1, = $189,100;
Work in progress inventory on December 31, = $197,600
Firstly, we are calculating the manufacturing cost by adding direct material, direct labor cost and factory overhead. It is calculated as follows:
= Direct material + Direct labor + Factory overhead
= $64,750 + $198,400 + $394,800
= $657,950
Cost of goods manufactured determine the value of goods produced during a period of time. It refers to the cost that is incurred to convert the raw material into the finished goods.
Therefore, the cost of goods manufactured is calculated as follows:
= Manufacturing cost + Opening work in process - Closing work in in process inventory
= $657,950 + $189,100 - $197,600
= $649,450
