THE CORRECT ANSWER IS A $ 6500 PLEASE EXPLAIN ME HOW TO SOLVE ITB,C AND D ARE WRONG Use the information below to answer the following two questions:Herbal Company provides the following data for the year ended December 31.Cost of goods available for sale during the yearDirect materials used in productionDirect labor cost used in productionActual manufacturing overhead cost$13,000$3,000$2,000$1,300Inventory balances at the beginning and end of the year were as follows:Beginning$10,000$2,000$6,000Ending$11,000Raw materialsWork in processFinished goods$1,500$4,00017 How much is the total manufacturing cost for the year?$6,500$7,000$6,300A.В.С.D.$12,500Е.None of the above

Answered: How much is the total manufacturing…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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THE CORRECT ANSWER IS A $ 6500

PLEASE EXPLAIN ME HOW TO SOLVE IT

B,C AND D ARE WRONG

Use the information below to answer the following two questions:
Herbal Company provides the following data for the year ended December 31.
Cost of goods available for sale during the year
Direct materials used in production
Direct labor cost used in production
Actual manufacturing overhead cost
$13,000
$3,000
$2,000
$1,300
Inventory balances at the beginning and end of the year were as follows:
Beginning
$10,000
$2,000
$6,000
Ending
$11,000
Raw materials
Work in process
Finished goods
$1,500
$4,000
17 How much is the total manufacturing cost for the year?
$6,500
$7,000
$6,300
A.
В.
С.
D.
$12,500
Е.
None of the above

Expert Solution

Step 1

Total manufacturing cost is calculated as total costs incurred in manufacturing the product. Total manufacturing cost would include raw material used cost, direct labor costs and manufacturing overhead applied to production. In this case the total cost of goods available for sale is given which would be used to calculate cost of goods manufactured. From cost of goods manufactured, the total manufacturing costs can be determined.

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