The following information relates to Cruz Manufacturing for 2013: $$\begin{array} { l c r }
\text { Raw materials used } & \$ & 20,000 \
\text { Direet hbor wages } & & 60,000 \
\text { Sales salaries and commissions } & & 50,000 \
\text { Depreciation on producticn equipment } & & 4,000 \
\text { Rent on manufacturing facilities } & & 30,000 \
\text { Packaging and shipping supplies } & & 6,000 \
\text { Sales revenue } & & 190,000 \
\text { Unis produced and sold } & & 10,000 \
\text { Selling price per unit } & \$ & 20.00
\end{array}$$ Based on this information, what is the company's cost of goods sold for 2013?
A) $86,000
B) $120,000
C) $114,000
D) $170,000

Question

The following information relates to Cruz Manufacturing for 2013: $$\begin{array} { l c r } 
\text { Raw materials used } & \$ & 20,000 \
\text { Direet hbor wages } & & 60,000 \
\text { Sales salaries and commissions } & & 50,000 \
\text { Depreciation on producticn equipment } & & 4,000 \
\text { Rent on manufacturing facilities } & & 30,000 \
\text { Packaging and shipping supplies } & & 6,000 \
\text { Sales revenue } & & 190,000 \
\text { Unis produced and sold } & & 10,000 \
\text { Selling price per unit } & \$ & 20.00
\end{array}$$ Based on this information, what is the company's cost of goods sold for 2013?
A) $86,000
B) $120,000
C) $114,000
D) $170,000

Quizplus · Accepted Answer

The company's cost of goods sold is calculated by adding the beginning inventory ($50,000) to the purchases ($125,000), giving a total of $175,000. Then, subtracting the ending inventory ($61,000) from this amount gives a cost of goods sold of $114,000 (175,000 - 61,000 = 114,000). Therefore, the correct answer is C.

The Following Information Relates to Cruz Manufacturing for 2013 Based on This Information, What Is the Company's Cost of