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Hamilton Company had the following inventory balances at the beginning and end of the year: January 1 December 31 Raw material $50,000 $35,000 Work in process 130,000 170,000 Finished goods 280,000 255,000 During the year, the company purchased $125,000 of raw materials, of which 20% are indirect materials. Indirect materials have no beginning and no ending inventories. Other cost data is as follows: Direct labor $340,000 Indirect labor 35,000 Selling and administrative salaries 90,000 Building depreciation* 400.000 Factory utilities 90,000 *Seventy-five percent of the company's building was devoted to production activities, the remaining 25% was used for selling and administrative functions. Required: 1. Calculate the amount of conversion costs. 2. Calculate the cost of goods manufactured. 3. Calculate the cost of goods soldStep by Step Solution
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