It is estimated that direct materials, direct labour and factory overhead for the period will total $60 000. If work in process at the start is $12 000 and estimated work in process at the end is $15 000, the cost of goods manufactured is:
A) $45 000
B) $57 000
C) $72 000
D) $75 000

Question

Quizplus · Accepted Answer

The cost of goods manufactured can be calculated as follows:
Beginning work in process + Total manufacturing costs incurred during the period - Ending work in process = Cost of goods manufactured
So, using the information given:
Beginning work in process = $12 000
Total manufacturing costs = $60 000
Ending work in process = $15 000
Therefore, Cost of goods manufactured = $12 000 + $60 000 - $15 000 = $57 000.
Hence, the correct answer is B).

It Is Estimated That Direct Materials, Direct Labour and Factory