For work done during August,Footprints Company incurred direct materials costs of $104,000 and conversion costs of $260,000.The company employs a just-in-time operating philosophy and backflush costing.At the end of August,it was determined that the Work in Process Inventory account had been assigned $1,080 of costs,and the ending balance of the Finished Goods Inventory account was $1,220.There were no beginning inventory balances.
-Using the information provided for Footprints Company,what is the cost of completed units for August?
A)$104,000
B)$260,000
C)$361,700
D)$362,920

Question

For work done during August,Footprints Company incurred direct materials costs of $104,000 and conversion costs of $260,000.The company employs a just-in-time operating philosophy and backflush costing.At the end of August,it was determined that the Work in Process Inventory account had been assigned $1,080 of costs,and the ending balance of the Finished Goods Inventory account was $1,220.There were no beginning inventory balances. 
-Using the information provided for Footprints Company,what is the cost of completed units for August?
A)$104,000
B)$260,000
C)$361,700
D)$362,920

Quizplus · Accepted Answer

To calculate the cost of completed units, we need to subtract the ending finished goods inventory from the total cost incurred during the period. 
Total Cost Incurred = Direct Materials + Conversion Costs
Total Cost Incurred = $104,000 + $260,000
Total Cost Incurred = $364,000

Cost of Completed Units = Total Cost Incurred - Ending Finished Goods Inventory
Cost of Completed Units = $364,000 - $1,220
Cost of Completed Units = $362,920

Therefore, the correct answer is D) $362,920.

For Work Done During August,Footprints Company Incurred Direct Materials Costs