The following partially completed T-accounts summarize transactions for Faas Company during the year:
-The Cost of Goods Manufactured was:
A) $22,900
B) $22,700
C) $8,200
D) $45,600

Question

The following partially completed T-accounts summarize transactions for Faas Company during the year: 
-The Cost of Goods Manufactured was:
A) $22,900 
B) $22,700 
C) $8,200 
D) $45,600

Quizplus · Accepted Answer

The cost of goods manufactured is calculated using the formula: 
Beginning Work in Process Inventory + Total Manufacturing Costs - Ending Work in Process Inventory = Cost of Goods Manufactured

From the T-accounts, we can see: 
Beginning Work in Process Inventory = $0 
Direct materials purchased = $12,900 
Direct labor = $7,800 
Manufacturing overhead = $6,000 
Total Manufacturing Costs = $12,900 + $7,800 + $6,000 = $26,700 
Ending Work in Process Inventory = $4,000

Therefore, Cost of Goods Manufactured = $0 + $26,700 - $4,000 = $22,700

The Following Partially Completed T-Accounts Summarize Transactions for Faas Company