Questions: Zoe Corporation has the following information for the month of March: Cost of materials placed in production 19,464 Direct labor 27,056 Factory overhead 36,980 Work in process inventory, March 1 17,656 Work in process inventory, March 31 19,283 Finished goods inventory, March 1 23,016 Finished goods inventory, March 31 23,448 a. Determine the cost of goods manufactured. 432 b. Determine the cost of goods sold.

Solution Steps

To determine the cost of goods manufactured and the cost of goods sold, we need to follow these steps:

a. Cost of Goods Manufactured (COGM):

1. Start with the beginning work in process inventory.
2. Add total manufacturing costs (cost of materials, direct labor, and factory overhead).
3. Subtract the ending work in process inventory.

b. Cost of Goods Sold (COGS):

1. Start with the beginning finished goods inventory.
2. Add the cost of goods manufactured.
3. Subtract the ending finished goods inventory.

The total manufacturing costs are the sum of the cost of materials, direct labor, and factory overhead: \[ \text{Total Manufacturing Costs} = \$19,464 + \$27,056 + \$36,980 = \$83,500 \]

The cost of goods manufactured is calculated by adding the beginning work in process inventory to the total manufacturing costs and then subtracting the ending work in process inventory: \[ \text{COGM} = \$17,656 + \$83,500 - \$19,283 = \$81,873 \]

The cost of goods sold is calculated by adding the beginning finished goods inventory to the cost of goods manufactured and then subtracting the ending finished goods inventory: \[ \text{COGS} = \$23,016 + \$81,873 - \$23,448 = \$81,441 \]

Final Answer