I am trying to learn how to Calculate Cost of goods manufactured. If I read correctly, it is Cost of Direct materials used, + Cost of direct labor, + Cost of MOH= Total manufacturing costs + add beginning WIP - Less ending WIP = Cost of goods manufactured.

I June 30

July 31

Inventories

Raw materials

62,000

75,000

Goods in process

85,000

95,000

Finished goods

103,000

58,000

Activities and information for July

Raw materials purchases by cash

510,000

Factory payroll by cash

745,000

Factory overhead

Indirect materials

24,000

Indirect labor

132,000

Other overhead costs

220,000

Sales in cash

3,500,000

Predetermined overhead rate based on direct labor cost

52%

I have already figured this out

Part A: Cost of Direct Materials used:

Beginning Raw Materials Inventory + Direct Materials bought - Ending raw materials inventory= Cost of Direct materials for production.

75,000 - 510,000 = 435,000

Part B: Cost of Direct Labor used

Beginning finished goods + COG manufactured - Less ending finished goods inventory = Cost of goods sold. (COGS).

58,000 + -58000

What am I not understanding about This third part?