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20 March, 22:43

The Machining Department started the current month with beginning goods 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 Goods in Process Inventory account for the Machining Department is:A. $13,000B. $1,000C. $49,000D. $110,000E. $3,000

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  1. 21 March, 00:24
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    ending = A. 13,000

    Explanation:

    We frist construct the production sheet for the period

    Beginning WIP 10,000

    cost added

    materials 76,000

    labor 24,000

    overhead

    50% of labor

    50% of 24,000 = 12,000

    total cost added 112,000

    ending WIP (?)

    transferred-out 109,000

    from the production sheet we solve for ending WIP

    beginning + cost added - ending = transefrred-out

    10,000 + 112,000 - ending = 109,000

    10,000 + 112,000 - 109,000 = ending

    ending = 13,000
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