On January 31, 2020, the manufacturing facility of a medium-sized company was severely damaged by an accidental fire. As a result, the company's direct materials, work in process, and finished goods inventories were destroyed. The company did have access to certain incomplete accounting records, which revealed the following:1.Beginning inventories, January 1, 2020:

Direct materials	$32,000
Finished goods	30,000
Work in process	68,000

2.Key ratios for the month of January 2020:

Gross profit = 20% of sales

Prime costs = 70% of manufacturing costs

Factory overhead = 40% of conversion costs

Ending work in process is always 10% of the monthly manufacturing costs.

3.All costs are incurred evenly in the manufacturing process.

4.Actual operations data for the month of January 2020:

Sales	$900,000
Direct labour incurred	360,000
Direct materials purchases	320,000

Instructions

a. From the above data, reconstruct a cost of goods manufactured schedule.

CGM $788,000

b. Calculate the total cost of inventory lost, and identify each category where possible (direct materials, work in process, and finished goods), at January 31, 2020.

Total $330,000