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6 May, 2015 - 17:10

The cost of goods manufactured statement combines all the direct materials, direct labor and factory with beginning work in process inventory, minus the ending work in process inventory, to report the total cost of the goods which have been manufactured during the period. In order to prepare the statement, a manufacturing summary is debited for all the costs during the year, and credited for the cost of goods manufactured and ending inventories. The cost of goods manufactured is added to finished goods inventory to sum to the goods available for sale, which gives the cost of goods sold when ending finished inventory is deducted.