*0 number of vehicles (units) represents the beginning balance of Work-in-Process Inventory.
$0 is the Beginning Inventory and/or dollar value for the 0 units of a product at the beginning balance of Work-in-Process Inventory.
*210,000 units of budgeted (planned) production of a product (or Actual production units of a product)
*150,000 units of a sold product
*$25.00 is the Total manufacturing cost per unit.
= WIP inventory + Production - Sales
= 0 units + 210,000 units of budgeted production of a product – 150,000 units of sold product
= 210,000 units of budgeted production of a product – 150,000 units of a sold product
= 50,000 units of a product that has been produced by Tulsa, Inc.
= 60,000 units of a product × $25 Total manufacturing cost per unit
= $1,500,000 Completed
$1,500,000 is the Ending Inventory (Ending dollar balance of account called Inventory).
The 50,000 units of a product that Tulsa, Inc. has produced (made) represents the “Transferred to finished goods” area of Work-in-process inventory and “Transferred in from Work-in-process inventory” area of the account called Finished goods inventory. However, the board of directors of Tulsa, Inc. are planning to order the production of 210,000 units of a product.
It is the 50,000 units of inventory of a product, which is reported.
The question I want you all to answer is the following:
Are the above two comments true based on your knowledge regarding the 50,000 units?
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