Answer:
Option (A) is correct.
Explanation:
Given that,
Direct materials = $58,500
Direct labor = $66,000
Manufacturing overhead = 120% of direct labor cost
Opening WIP = $30,800
Cost of goods manufactured:
= Direct materials + Direct labor + Manufacturing overhead
= $58,500 + $66,000 + 120% of direct labor cost
= $58,500 + $66,000 + (120% × $66,000)
= $58,500 + $66,000 + $79,200
= $203,700
December 31 balance of Work-in-Process Inventory:
= Opening WIP + cost of goods manufactured - cost of goods completed
= $30,800 + $203,700 - $220,700
= $13,800
