Question

Adams Company is a manufacturing company that has worked on several production jobs during the first...

Adams Company is a manufacturing company that has worked on several production jobs during the first quarter of the year. Below is a list of all the jobs for the quarter:

Balance
Job No. 356 $ 450
Job No. 357 1,235
Job No. 358 378
Job No. 359 689
Job No. 360 456


Jobs 356, 357, 358, and 359 were completed. Jobs 356 and 357 were sold at a profit of $500 on each job.

What is the ending balance of Finished Goods for Adams Company at the end of the first quarter?

a.$1,067

b.$1,685

c.$2,752

d.$456

Business   Accounting   
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Answer #1

The answer to the question is a. $ 1,067

Explanation : Out of 5 Jobs given in the question four jobs were completed. The jobs which were completed are parts of finished goods. But two jobs, Job no. 356 and Job no. 357 were sold. So job no. 356 and job no. 357 which were sold do not form part of ending balance of finished goods. The completed jobs i.e. Job no 358 and Job no. 359 which were not sold become part of ending balance of finished goods for Adams Company i.e. $378 + $ 689 = $ 1,067 .The remaining Job No. 360 is work in progress because it is not yet completed.

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