All raw materials used were traceable to specific units of product. Healey Company's total manufacturing costs for the year are: Multiple Choice

Question Completion:

Current information for the Healey Company follows:

Beginning raw materials inventory $25,200  

Raw material purchases 70,000  

Ending raw materials inventory 26,600  

Beginning work in process inventory 32,400  

Ending work in process inventory 38,000  

Direct labor 52,800  

Total factory overhead 40,000

Healey Company

Total manufacturing costs for the year are:

$155,800

Explanation:

a) Data and Calculations:

Beginning raw materials inventory   $25,200  

Raw material purchases                      70,000  

Ending raw materials inventory         (26,600)

Cost of raw materials used               $68,600

Beginning work in process inventory 32,400  

Ending work in process inventory     (38,000)  

Direct labor                                          52,800  

Total factory overhead                        40,000

Total manufacturing costs               $155,800

b) The total manufacturing costs are made up of costs of direct materials, direct labor, and factory overhead.  These costs are incurred in the production process and can be traced to the units of product(s) being manufactured.

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