For work done during August, Printing Press Company incurred direct materials costs of $130,000 and conversion costs of $221,000. The company employs a traditional operating philosophy. At the end of August, it was determined that the Work in Process Inventory account had been assigned $1,000 of costs, and the ending balance of the Finished Goods Inventory account was $3,000. There were no beginning inventory balances. How much was cost of goods manufactured during August?
A) $351,000
B) $350,000
C) $348,000
D) $347,000

Question

Quizplus · Accepted Answer

Cost of goods manufactured = Total manufacturing costs incurred - Ending Work in Process Inventory + Beginning Work in Process Inventory 
Since there was no beginning Work in Process Inventory, the equation simplifies to: 
Cost of goods manufactured = Direct materials costs + Conversion costs - Ending Work in Process Inventory 
Cost of goods manufactured = $130,000 + $221,000 - $1,000 = $350,000. Therefore, the correct option is B.

For Work Done During August, Printing Press Company Incurred Direct