A. This answer is incorrect.

B. This answer is incorrect.

C. For a manufacturing company, the cost of goods sold can be calculated as the beginning finished goods inventory plus the cost of goods manufactured minus the ending finished goods. This is $85,000 + $484,000 - $78,000 and totals $491,000.

To calculate the cost of goods manufactured, we simply take the total cost of manufacturing and adjust it for the change in work-in-progress. Total manufacturing cost is made up of prime costs plus manufacturing overheads applied. The prime costs are direct materials used and direct labor used. We are told that the direct labor was $200,000, but we will need to calculate the direct materials used for November. The beginning inventory of direct materials was $67,000. During the period, they purchased $163,000 of direct materials and also incurred $4,000 in transportation-in costs. However, they also returned $2,000 of direct materials during the period. Adding these together, we can calculate the total direct materials that they had available for use during November was $232,000 ($67,000 + $163,000 + $4,000 - $2,000). Since there was an ending inventory of $62,000, they must have used $170,000 of direct materials during the period ($232,000 - $62,000). Adding $170,000 of direct materials used to the $200,000 of direct labor used, the total prime costs were $370,000. We do not worry about the raw materials and finished goods inventory numbers because the amounts in those accounts were not related to the current period.

Overhead is applied as 70% of direct labor, which equals $140,000 ($200,000 × 70%). Adding the prime costs and the overhead together, we get $510,000. Work-in-progress increased during the period by $26,000. This means that $26,000 of the work performed during the period ended up in work-in-progress and not finished goods, so this amount needs to be subtracted from cost of goods manufactured.

The cost of goods manufactured is $484,000. The beginning balance of finished goods was $85,000. Adding together the cost of goods manufactured and beginning inventory balance we get $569,000. The ending balance of finished goods inventory was $78,000. Subtracting the amount of ending finished goods inventory from the amount of finished goods available for sale, we get the amount of COGS: $491,000.

D. For a manufacturing company, the cost of goods sold can be calculated as the beginning finished goods inventory plus the cost of goods manufactured minus the ending finished goods. This is the cost of goods manufactured.