At the beginning of the current year, the Grant Company's work in process inventory account had a balance of $30,000. During the year, $68,000 of direct materials were used in production, and $66,000 of direct labor costs were incurred. Factory overhead for the year amounted to $90,000. Cost of goods manufactured is $230,000. The balance in work in process inventory on December 31 is a. $66,000 b. $36,000 c. $44,000 d. $24,000

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Business

Ansley Vincent

25 October, 16:52

At the beginning of the current year, the Grant Company's work in process inventory account had a balance of $30,000. During the year, $68,000 of direct materials were used in production, and $66,000 of direct labor costs were incurred. Factory overhead for the year amounted to $90,000. Cost of goods manufactured is $230,000. The balance in work in process inventory on December 31 is a. $66,000 b. $36,000 c. $44,000 d. $24,000

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Kathryn Wilkinson · Answer 1

Answer: The correct answer is "d. $24,000".

Explanation: The balance in the work-in-process inventory on December 31 is equal to $ 24,000.

First we must calculate the manufacturing costs of the period = Direct materials + Direct labor + Factory Overhead = 68000 + 66000 + 90000 = 224000.

Secondly, we must add to the manufacturing costs of the period the initial existence of work in progress = 224000 + 30000 = 254000

Finally we subtract the Cost of goods manufactured that is $ 230,000 = 254000 - 230000 = $24000.