Question

Use the following information to compute the cost of direct materials used for the current year. Assume the raw materials inventory account is used only for direct materials. (Assume no indirect materials.)

January 1 December 31
Inventories
Raw materials inventory $8,900 $11,300
Work in process inventory 14,600 11,400
Finished goods inventory 9,600 6,400
Activity during current year Materials purchased $126,000
Direct labor 100,800
Factory overhead 44,700

Answer 1

Direct material used= $123,600

Step-by-step explanation:

Giving the following information:

January 1 December 31

Inventories

Raw materials inventory $8,900 $11,300

Materials purchased $126,000

To calculate the direct material used, we need to use the following formula:

Direct material used= beginning inventory + purchases - ending inventory

Direct material used= 8.900 + 126,000 - 11,300

Direct material used= $123,600