Asked by Kanidra Stringer on May 14, 2024
Verified
The gross profit of Abel Company for 2010 is $300, 000, cost of goods manufactured is $400, 000, the beginning inventories of goods in process and finished goods are $28, 000 and $35, 000, respectively, and the ending inventories of goods in process and finished goods are $50, 000 and $70, 000, respectively.The cost of goods sold of Abel Company for 2010 must have been
A) $378, 000
B) $265, 000
C) $278, 000
D) $365, 000
Cost of Goods Sold
The direct costs attributable to the production of the goods sold in a company, including material and labor costs.
Cost of Goods Manufactured
The total production cost of goods completed during a specific accounting period, including raw materials, labor, and overhead.
Finished Goods
Products that have completed the manufacturing process and are ready for sale to customers.
- Determine the cost of goods sold using available financial information from manufacturing operations.
Verified Answer
BN
Balqis NajihahMay 15, 2024
Final Answer :
D
Explanation :
To find the cost of goods sold, we need to use the following formula:
Cost of goods sold = Beginning inventory of finished goods + Cost of goods manufactured - Ending inventory of finished goods
Beginning inventory of finished goods = $35,000
Cost of goods manufactured = $400,000
Ending inventory of finished goods = $70,000
Therefore, Cost of goods sold = $35,000 + $400,000 - $70,000 = $365,000
Therefore, the answer is D, $365,000.
Cost of goods sold = Beginning inventory of finished goods + Cost of goods manufactured - Ending inventory of finished goods
Beginning inventory of finished goods = $35,000
Cost of goods manufactured = $400,000
Ending inventory of finished goods = $70,000
Therefore, Cost of goods sold = $35,000 + $400,000 - $70,000 = $365,000
Therefore, the answer is D, $365,000.
Learning Objectives
- Determine the cost of goods sold using available financial information from manufacturing operations.