Question

Xia Co. manufactures a single product. All raw materials used are traceable to specific units of product. Current information for company follows:

Beginning raw materials inventory	$	9,000
Ending raw materials inventory		12,000
Raw material purchases		86,000
Beginning work in process inventory		21,000
Ending work in process inventory		31,000
Direct labor		111,000
Total factory overhead		86,000
Beginning finished goods inventory		61,000
Ending finished goods inventory		41,000

The company's cost of direct materials used, cost of goods manufactured and cost of goods sold is:

Answer 1

cost of direct materials used = Beginning inventory + purchases - ending inventory
=$9000+86000-12000
=$83000
Cost of goods manufactured =Beginning work in progress + Raw material used +direct labor + factory overhead+ - ending work in progress
=21000+83000+111000+86000-31000
=$270000
Cost of goods sold = Beginning finished goods + cost of goods manufactured - ending finished goods
=$61000+270000-41000
=$290000