The Machining Department Started the Current Month with a Beginning

question 67

Multiple Choice

The Machining Department started the current month with a beginning goods in process inventory of $10,000. During the month, it was assigned the following costs: direct materials, $76,000; direct labor, $24,000; and factory overhead, 50% of direct labor cost. Also, inventory with a cost of $109,000 was transferred out of the department to the next phase in the process. The ending balance of the Goods in Process Inventory account for the Machining Department is:

• A) $13,000.
• B) $56,000.
• C) $59,000.
• D) $110,000.
• E) $165,000.

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Definitions:

Payments to Vendors

Money transfers made by a business to its suppliers for goods or services received.

Demand Deposit

Bank accounts that allow the holder to withdraw funds without prior notice, such as a checking account.

Marketable Securities

Financial instruments that can easily be sold or converted into cash at a value close to their market rate.

Precautionary Demand

Precautionary demand refers to the desire to hold cash or easily liquidatable assets to safeguard against unexpected financial needs or market fluctuations.