The Fabricating Department started the current month with a beginning Work in Process inventory of $10,000.During the month,it was assigned the following costs: direct materials,$76,000;direct labor,$24,000;and factory overhead,50% of direct labor cost.Also,inventory with a cost of $109,000 was transferred out of the department to the next phase in the process.The ending balance of the Work in Process Inventory account for the Fabricating Department is:
A)$13,000.
B)$56,000.
C)$59,000.
D)$110,000.
E)$165,000.

Question

Quizplus · Accepted Answer

The total costs assigned during the month are $76,000 (direct materials) + $24,000 (direct labor) + $12,000 (factory overhead, which is 50% of direct labor) = $112,000. Adding the beginning inventory of $10,000 gives a total of $122,000. Subtracting the $109,000 transferred out leaves an ending balance of $13,000.

The Fabricating Department Started the Current Month with a Beginning