Question

On January​ 1, Alistair Manufacturing had a beginning balance in WorkminusinminusProcess Inventory of $ 163 comma 000 and a beginning balance in Finished Goods Inventory of $ 22 comma 000. During the​ year, Alistair incurred manufacturing costs of $ 203 comma 000. During the​ year, the following transactions​ occurred: Job Cminus62 was completed for a total cost of $ 144 comma 000 and was sold for $ 158 comma 000. Job Cminus63 was completed for a total cost of $ 184 comma 000 and was sold for $ 214 comma 000. Job Cminus64 was completed for a total cost $ 81 comma 000 but was not sold as of yearminusend. The Manufacturing Overhead account had an unadjusted credit balance of $ 25 comma 000 and was adjusted to zero at yearminusend. What was the amount of gross profit reported by Alistair at the end of the​ year?

Answer 1

Answer:

$69000

Explanation:

The Gross profit that is reported by Alistair at the end of the year, will be calculated as follow;

Formula is as follow;

Total revenues – (Cost of goods sold – unadjusted credit balance manufacturing overheads account)

Followings values are given in the question;

Total revenues ($158000 + $214000) = $372000

Cost of goods sold ($144000 + $184000) = $328000

Unadjusted credit balance manufacturing overheads account = $25000

Now let’s put the values in the formula;

$372000 – ($328000 – $25000)

$372000 – $303000 = $69000