Question

Consider Derek's budget information:

materials to be used totals $64,100; direct labor totals $198,100; factory overhead totals $394,200; work in process inventory January 1 is $186,700; and work in progress inventory on December 31 is $192,200. The budgeted cost of goods manufactured for the year is:_________.
a. $649,450.
b. $657,950.
c. $197,600.
d. $1,044,650.

Answer 1

650,900 is the answer to this question.

Step-by-step explanation:

$64,100 + $198,100 + $394,200 = $656400

Now costs of goods manufactured = Opening Work in process + Manufacturing expenses for the year - Closing work in process

$186,700 + $656400 - $192,200

= $650,900

cost of goods manufactured is cost for completed goods, opening work in process would be completed during the year and cost incurred during the year is also for completed units except that incurred on closing work in process as it is incomplete.