Question

1.Manufacturing costs are typically classified as Select one: a. direct materials or direct labor b. product costs or period costs c. direct materials, direct labor, or manufacturing overhead d. direct materials, direct labor, or selling and administrative

2. Raw materials inventory, January 1 $ 12,000 Raw materials inventory, December 31 16,000 Work in process, January 1 5,000 Work in process, December 31 8,000 Finished goods, January 1 17,000 Finished goods, December 31 12,000 Raw materials purchases 118,000 Direct labor 165,000 Factory utilities 64,000 Indirect labor 12,000 Factory depreciation 18,000 Selling and administrative expenses 220,000 How much is the cost of the direct materials used? Select one: a. $114,000 b. $118,000 c. $122,000 d. $130,000

3. Raw materials inventory, January 1 $ 12,000 Raw materials inventory, December 31 16,000 Work in process, January 1 5,000 Work in process, December 31 8,000 Finished goods, January 1 17,000 Finished goods, December 31 12,000 Raw materials purchases 118,000 Direct labor 165,000 Factory utilities 64,000 Indirect labor 12,000 Factory depreciation 18,000 Selling and administrative expenses 220,000 Assume the cost of direct materials used is $130,000. How much are total manufacturing costs? Select one: a. $393,000 b. $609,000 c. $295,000 d. $389,000

4. Raw materials inventory, January 1 $ 12,000 Raw materials inventory, December 31 16,000 Work in process, January 1 5,000 Work in process, December 31 8,000 Finished goods, January 1 17,000 Finished goods, December 31 12,000 Raw materials purchases 118,000 Direct labor 165,000 Factory utilities 64,000 Indirect labor 12,000 Factory depreciation 18,000 Selling and administrative expenses 220,000 Assume total manufacturing costs are $400,000. How much is cost of goods manufactured? Select one: a. $397,000 b. $403,000 c. $400,000 d. $389,000

5. Raw materials inventory, January 1 $ 12,000 Raw materials inventory, December 31 16,000 Work in process, January 1 5,000 Work in process, December 31 8,000 Finished goods, January 1 17,000 Finished goods, December 31 12,000 Raw materials purchases 118,000 Direct labor 165,000 Factory utilities 64,000 Indirect labor 12,000 Factory depreciation 18,000 Selling and administrative expenses 220,000 Assume cost of goods manufactured is $420,000. How much is cost of goods sold? Select one: a. $425,000 b. $408,000 c. $420,000 d. $295,000

Answer 1

(1) Option C is correct i.e

Manufacturing cost =D irect materials, direct labor, or manufacturing overhead

(2) Cost of Direct Material Used :-

Ram Material Purchase + Beginning Inventory of RM – Ending Inventory of RM

      = 118000 + 12000 – 16000 = $114000

Optin A is correct

(3) Total Manufacturing cost :-

cost of direct materials used	130000
(+) Direct Labour	165000
(+) Factory Utilities	64000
(+) Indirect Labour	12000
(+) Factory Dep	18000
	389000

Option D is Correct

(4) Cost of Goods Manufactured :-

Total Manufacturing cost + Beginning WIP – Ending WIP

= 400000 + 5000 – 8000 = $397000

Option A is correct

(5) Cost of Goods Sold :-

Cost of Goods Manufactured + Beginning Finished Goods – Ending Finished Goods

420000 + 17000 – 12000 = $425000

Option A is correct