The following information was taken from the accounting records of Fessler Tool Corporation. Work in process inventory, beginning of the year $ 35,000 Cost of direct materials used 265,000 Direct labor cost applied to production 135,000 Cost of finished goods manufactured 698,250 Overhead assigned to production was $300,000. Compute the amount of the work in process inventory on hand at year-end.

Ending WIP = 36,750

Explanation:

Beginning WIP  35.000

Cost added:

Materials   265,000

Labor          135,000

Ovehead   300,000

Total           700,000

Cost of goods manufactured (completed)  698,250

We solve using the inventory identity:

beginning + cost added = ending + transferred

Ending Invnetory = Beginning + cost added - transferred

Ending WIP = 35,000 + 700,000 - 698,250

Ending WIP = 36,750

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