The following information relates to the operations of Cruz Manufacturing during the current year: Based on this information, what is the company's cost of goods sold?
A) $86,000
B) $120,000
C) $114,000
D) $170,000

Question

The following information relates to the operations of Cruz Manufacturing during the current year:  Based on this information, what is the company's cost of goods sold?
A) $86,000 
B) $120,000 
C) $114,000 
D) $170,000

Quizplus · Accepted Answer

Product Costing in Manufacturing Companies = (Materials cost + Labor costs + Overhead costs) ÷ Number of units produced
Product Costing in Manufacturing Companies = [$20,000 + $60,000 + ($4,000 + $30,000)] ÷ 10,000 units = $11.40 per unit
Cost of goods sold = Number of units sold × Product Costing in Manufacturing Companies
Cost of goods sold = 10,000 units sold × $11.40 per unit = $114,000

The Following Information Relates to the Operations of Cruz Manufacturing