Question

Compute the amount of raw materials used during August if $30,000 of raw materials were purchased during the month and the inventories were as follows:

Inventories Balance August 1 Balance August 31
Raw materials $3,500 $3,600
Work in process $12,000 $10,000
Finished goods $18,000 $16,000

Answer 1

$

Opening inventory of raw material 3,500

Add: Purchases of raw material 30,000

33,500

Less: Closing inventory of raw material 3,600

Amount of raw material used 29,900

Step-by-step explanation:

The amount of raw material used equals opening inventory of raw material plus purchases of raw material minus closing inventory of raw material.

Answer 2

Raw Materials used in production during the month of August equals $29,900

Explanation:

Beginning Raw Materials Inventory (August 1) $3,500

Add: Raw Materials Purchased during

the month of August $30,000

Raw Materials available for use in production $33,500

Less: Ending Raw Materials Inventory (August 31) $(3,600)

Raw Materials Used in production

during the month of August $29,900