Answered: During 2020, the company purchased OMR…

During 2020, the company purchased OMR 1,450,000 of materials, had a direct labor cost of OMR 250,000, and manufacturing overhead was OMR 160,000. The cost of goods sold is:

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 21E: Ellerson Company provided the following information for the last calendar year: During the year,...

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Concept explainers

Contract Costing

Contract costing is about tracing particular costs related to a particular contract entered into with the customer. It is one of the forms of job order costing. It is useful in long-term contracts at the most. It is seen that substantial time is required for the completion of the contract which takes different accounting periods. Thus, it is very much helpful for recognizing the costs associated with it and accounting in their specific accounting periods.

Question

Bidiyah Sugar Factory had the following data:
Jan. 1, 2020
Dec. 31, 2020
Raw materials inventory
OMR 80,000
OMR 64,000
Work in process inventory
104,000
116,000
Finished goods inventory
100,000
92,000
During 2020, the company purchased OMR 1,450,000 of materials, had a direct labor cost of OMR 250,000, and manufacturing
overhead was OMR 160,000. The cost of goods sold is:
Select one:
O a. 1,684,000
O b. None of the answers are correct
O c. 1,872,000
O d. 1,610,000
Oe. 1,864,000

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