Question

he following information has been taken from the perpetual inventory system of Elite Mfg. Co. for the month ended August 31: Purchases of direct materials $ 60,000 Direct materials used $ 50,000 Direct labor costs assigned to production $ 25,000 Manufacturing overhead costs incurred (and applied) $ 35,000 Balances in inventory August 31 August 1 Materials $ ? 25,000 Work in Process $ 65,000 47,000 Finished Goods $ 60,000 43,000 The total amount of inventory to be included in Elite's August31st balance sheet amounts to:

Answer 1

Answer:

$115,000

Explanation:

Elite Mfg. Co is a manufacturing company. For a manufacturing company, the balance sheet often show three (3) categories of Inventories. These relate to Raw Materials, Work in Process and Finished Goods.

Thus, the total amount of inventory to be included in Elite's August31st balance sheet is calculated as :

Materials                       $25,000

Work in Process           $47,000

Finished Goods            $43,000

Total                              $115,000