Chapter 1, Problem 11QS

To determine

Cost of Goods Manufacture (COGM):

Cost of goods manufacture is the cost related with the goods which were being manufactured within a fiscal year. The following cost covers labor cost, unprocessed material used cost and any other support cost which helped to reshape the unfinished into end goods or materials which have entered the production process thus have consumed of reasonable cost.

Direct Materials:

Direct materials incorporate the items or materials used in the production of the product meant for the purpose of sale.

Work-in-Process:

The stock items which have been put in the production process and are still under the process of transformation into the final product at the end of the fiscal year are termed as work in process. It is stated as an asset in the balance sheet.

Factory Overhead Cost:

The cost or the expense which is associated with the production of the products though in direct way is termed factory overhead. Thus it incorporates all the provisions expense indirectly related to the production process.

Manufacturing Cost:

The total of the cost associated with the production process is termed as manufacturing cost. It comprises of cost directly related to the labor and materials as well as that of factory overhead.

To compute: Cost of goods manufactured for the year 2017.