Lopez Corporation incurred the following costs while manufacturing its product.

Materials used in product $123,900 Advertising expense $49,600
Depreciation on plant 67,500 Property taxes on plant 23,400
Property taxes on store 8,420 Delivery expense 24,000
Labor costs of assembly-line workers 116,200 Sales commissions 41,100
Factory supplies used 24,600 Salaries paid to sales clerks 53,000

Work in process inventory was $14,700 at January 1 and $16,900 at December 31. Finished goods inventory was $70,700 at January 1 and $48,900 at December 31.

Required:
a. Compute cost of goods manufactured.
b. Compute Cost of goods sold.

(a) $353,400

(b) $375,200

Explanation:

Given that,

Materials used in product = $123,900

Advertising expense = $49,600

Depreciation on plant = 67,500

Property taxes on plant = 23,400

Property taxes on store = 8,420

Delivery expense = 24,000

Labor costs of assembly-line workers = 116,200

Sales commissions = 41,100

Factory supplies used = 24,600

Salaries paid to sales clerks = 53,000

(a) Cost of goods manufactured:

= Material used in product + Depreciation on plant + Labor costs of assembly-line workers + Factory supplies used + Property taxes on plant + Beginning Work in process inventory - Ending Work in process inventory

= $123,900 + $67,500 + $116,200 + $24,600 + $23,400 + $14,700 - $16,900

= $353,400

(b) Cost of goods sold:

= Cost of goods Manufactured + Opening finished goods - Closing finished goods

= $353,400 + $70,700 - $48,900

= $375,200

answer(c) factors of production;