If the amount of \"Cost of Goods manufactured\" during a periodexceeds the amoun

Question

If the amount of "Cost of Goods manufactured" during a periodexceeds the amount of "Total manufacturing costs" for the periodthen: ending work in process is greater than the amount of thebeginning work in process inventory. ending work in process is less than the amount of thebeginning work in process inventory. ending owrk in process inventory is greater than or equal tothe amount of the beginning work in process inventory. ending work in process is equal to the cost of goodsmanufactured. If the amount of "Cost of Goods manufactured" during a periodexceeds the amount of "Total manufacturing costs" for the periodthen: ending work in process is greater than the amount of thebeginning work in process inventory. ending work in process is less than the amount of thebeginning work in process inventory. ending owrk in process inventory is greater than or equal tothe amount of the beginning work in process inventory. ending work in process is equal to the cost of goodsmanufactured.

Explanation / Answer

Choice B. Ending work in process is less than the amount of the beginningwork in process inventory Explanation Total manufacturing costs includes direct labor and overhead. Cost of goods manufactured = Beg bal of WIP + material used +manufacturing cost - ending inventory If COGM exceeds toal manufacturing costs, then ending inventoryautomatically goes down.

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