Crane Company has beginning work in process inventory of $124000 and total manufacturing costs of $286000....

Crane Company has beginning work in process inventory of $124000 and total manufacturing costs of $286000. If cost of goods manufactured is $260000, what is the cost of the ending work in process inventory?

$170000.

$150000.

$98000.

$130000.

Solutions

Expert Solution

For a manufacturing business entity, we have an equation which is,

Total manufacturing cost + Beginning work in process inventory - ending work in process inventory = Cost of goods manufactured.

Total manufacturing cost = $ 286,000.

Beginning work in process = $ 124,000.

Cost of goods manufactured = $ 260,000

We need to find the value of ending work in process.

Let us assume that ending work in process inventory be ' X'. Now by applying values to the equation,

Total manufacturing cost + Beginning work in process inventory - ending work in process inventory = Cost of goods manufactured.

286,000 + 124,000 - X = 260,000

410,000 - X = 260,000

X. = 410,000 - 260,000

X. = $ 150,000.

So ending work in process inventory is calculated as $ 150,000.

Hence, option B is the correct answer.

SUMMARY:

By applying values to the given equation above we find that ending work in process inventory is $ 150,000.

Hence, option B is the correct answer.

ekkarill92 answered 1 year ago

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