Alexandria Aluminum Company, a manufacturer of recyclable soda cans, had the following inventory balances at the beginning and end of 20x1. Inventory Classification Raw material Work in process Finished goods Indirect material Indirect labor January 1, 20x1 $ 50,000 120,000 140,000 During 20x1, the company purchased $240,000 of raw material and spent $400,000 on direct labor. Manufacturing overhead costs were as follows: Depreciation on plant and equipment Utilities Other December 31, 20x1 $70,000 115,000 165,000 $ 12,000 23,000 100,000 23,000 30,000 Sales revenue was $1,106,000 for the year. Selling and administrative expenses for the year amounted to $110,000. The firm's tax rate is 40 percent.

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Inventory Accounting

Inventory accounting is that branch of accounting that helps in determining the specific value of assets at different stages of production and development.