Sanchez & Company produces paints. On July 1, it had no work-in-process inventory. It starts production of 150,000 gallons of paint in July and completes 120,000 gallons. The costs of the resources used by Sanchez in July consist of the following:
Materials . . . . . . . . . . . . . . . . . . . . . . . . . . $137,000
Conversion costs (labor and overhead) . . . 175,000
Required
The production supervisor estimates that the ending work in process is 16 percent complete. Compute the cost of paint transferred to finished goods and the amount in work-in-process ending inventory as of July 31.