Benson Inc.'s accounting records reflect the following inventories: $$\begin{array} { l c c }
& \text { Dec. 31,2012 } & \text { Dec. 31,2013 } \
\text { Raw materials inventory } & \$ 80,000 & \$ 64,000 \
\text { Work in process inventory } & 104,000 & 116,000 \
\text { Finished goods inventory } & 100,000 & 92,000
\end{array}$$ During 2013, Benson purchased $1,160,000 of raw materials, incurred direct labor costs of $200,000, and incurred manufacturing overhead totaling $128,000.
- Assume Benson's cost of goods manufactured for 2013 amounted to $1,360,000.How much would it report as cost of goods sold for the year?
A)$1,368,000
B)$1,400,000
C)$1,460,000
D)$1,352,000

Question

Benson Inc.'s accounting records reflect the following inventories: $$\begin{array} { l c c } 
& \text { Dec. 31,2012 } & \text { Dec. 31,2013 } \
\text { Raw materials inventory } & \$ 80,000 & \$ 64,000 \
\text { Work in process inventory } & 104,000 & 116,000 \
\text { Finished goods inventory } & 100,000 & 92,000
\end{array}$$ During 2013, Benson purchased $1,160,000 of raw materials, incurred direct labor costs of $200,000, and incurred manufacturing overhead totaling $128,000. 
- Assume Benson's cost of goods manufactured for 2013 amounted to $1,360,000.How much would it report as cost of goods sold for the year?
A)$1,368,000
B)$1,400,000
C)$1,460,000
D)$1,352,000

Quizplus · Accepted Answer

The cost of goods sold is calculated as: Beginning Finished Goods Inventory + Cost of Goods Manufactured - Ending Finished Goods Inventory = $100,000 + $1,360,000 - $92,000 = $1,368,000.

Benson Inc During 2013, Benson Purchased $1,160,000 of Raw Materials, Incurred Direct