1: If 40% of those purchased materials were consumed, were $2000 consumed and $3000 left in inventory?
2: Does that mean that $3000 is my ending work in process inventory?
My statement of COGM is below with my questions in bold. Thanks for your help!
Statement of Cost of Goods Manufactured
INSTRUCTIONS: The following are the actual numbers for January:
Materials Purchased $5,000 of Materials Consumed 40% of those purchased materials
Direct Labor Direct Labor was $6,240
Factory Overhead Factory Overhead was $2,800
Sunshine Pet Services Statement of Cost of Goods Manufactured For the Month Ended January 31, xxxx
Beginning Work in Process Inventory $ –
Direct Materials: Materials – Beginning $ –
Add: Purchases for month of January 5,000
Materials Available for Use $ 5,000.00
Deduct: Ending Materials 3,000
Materials Used in Production $ 2,000.00
Direct Labor 6,240
Factory Overhead 2,800
Total Manufacturing Overhead $ 9,040.00
Deduct: Ending Work in Process Inventory 3000
Cost of Goods Manufactured $ 6040