During its first year of operations, Silverman Company paid $19,000 for direct materials and $10,500 for production workers' wages. Lease payments and utilities on the production facilities amounted to $9,500 while general, selling, and administrative expenses totaled $5,000. The company produced 6,500 units and sold 4,000 units at a price of $8.50 a unit.What is the amount of finished goods inventory on the balance sheet at year-end?

The cost of goods manufactured can be calculated by adding direct labor costs @ $10500, direct material costs @ $19000 and overhead costs @ $9500 and dividing it by 6500, we get $6.

Now, 4000 units has been sold so 2500 units are in ending inventory. The total amount in ending inventor is "

2500*6 = 15000

tanveermoledina tanveermoledina · Answer 2 · 2020-03-05T08:50:27+01:00

Answer:

The inventory value in the balance sheet is $ 15,000

Explanation:

Computation of per unit cost of production

Direct materials $ 19,000

Direct Labor $ 10,500

Production facilities related cost $ 9,500

Total cost of production $ 39,000

Units produced 6,500 units

Pr]oduction cost per unit $ 6 per unit

Units sold 4,000 units

Units in hand ( 6,500 produced - 4,000 sold) 2,500 units

Inventory value 2,500 units on hand * $ 6 per unit $ 15,000