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EA5.
LO 4.3Sterling’s records show the work in process inventory had a beginning balance of $4,000 and an ending balance of $3,000. How much direct labor was incurred if the records also show:

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Answer:

$4,500

Explanation:

Given that,

Beginning balance of work in process = $4,000

Ending balance of work in process = $3,000

Direct labor:

= Cost of goods manufactured + Ending balance of work in process - Beginning balance of work in process - Material used - Overhead applied

= $7,500 + $3,000 - $4,000 - $1,500 - $500

= $4,500

Note:

Table is missing from the question so I have attached the table.

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