At the beginning of theâ year, Swift,â Inc.'s Work-in-Process Inventory account had a balance of $ 122 comma 000. During theâ year, $ 250 comma 000 of direct materials were used inâ production, and $ 70 comma 000 of direct labor costs were incurred. Manufacturing overhead amounted to $ 826 comma 000. The cost of goods manufactured was $ 673 comma 000. What is the balance in theâ Work-in-Process Inventory account on Decemberâ 31?

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andromache andromache · Answer 1 · 2020-01-23T07:47:21+01:00

Answer:

$595,000

Explanation:

We know that

Cost of goods manufactured = Work in process opening balance + Manufacturing cost - Work in process closing balance

where manufacturing cost equal to

= Direct material used + Direct labor cost + Manufacturing Overhead cost

= $250,000 + $70,000 + $826,000

= $1,146,000

So, the Work in process closing balance would be

$673,000 = $122,000 + $1,146,000 - Work in process closing balance

So, the Work in process closing balance would be $595,000