Consider the following for Columbia Street Manufacturing: Change in finished goods inventory$1,201increase Change in work-in-process inventory$494decrease...

Consider the following for Columbia Street Manufacturing: Change in finished goods inventory$1,201increase Change in work-in-process inventory$494decrease Total manufacturing costs$1,080 What are the cost of goods manufactured and cost of goods sold? Cost of goods manufactured Cost of goods sold A.$1,101 $1,374 B.$1,574 $373 C.$1,993 $1,249 D.$1,574 $781 Multiple ChoiceOption A Option B Option C Option D

Solutions

Expert Solution

Cost of goods manufactured takes into account manufacturing cost and work in process

Cost of goods sold takes into account changes in finished goods inventory and cost of goods manufactured

Cost of goods sold:

Cost of goods manufactured = Beginning work in process+ manufacturing cost-Ending work in process

If there is decrease in WIP it means beginning WIP> Ending WIP, So it will be added

Manufacturing costs	$1,080
Add (Less): Decrease(Increase )in work in process	$494

Cost of goods manufactured	$1,574

Cost of good sold

Cost of goods sold = Beginning FInished goods +Cost of goods manufactured -Ending finished goods

Ending finished goods > Beginning finished goods, so it will be deducted

Cost of goods manufactured	$1,574
Add (Less): Decrease(Increase ) finished goods inventory	($1,201)

Cost of goods Sold	$373

Answer B)

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ekkarill92 answered 1 year ago

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