Q39 Machine Builders Incorporated adopted a standard cost system several years ago that it uses in conjunction with its process cost system. The per-unit standard costs for direct materials and direct labor for its single product are as follows: Materials:(5 kilograms × $9 per kilogram)$ 45Labor:(4 hours × $21 per hour)$ 84 All materials are issued at the beginning of processing. The operating data shown below were taken from the records for July: In-process beginning inventorynone In-process ending inventory—90% complete as to labor1,000unitsUnits completed during the month7,900unitsBudgeted output8,600unitsPurchases of materials, in kilograms (AQ)24,000 Total actual labor costs incurred$ 520,000 Direct labor hours worked (AQ)27,000hoursMaterials purchase-price variance$ 3,200unfavorableIncrease in materials inventory in July1,900kilogramsBeginning inventory of materials0kilogram The actual total cost of direct materials used in production during July, to the nearest dollar, was: (Round your final calculation to 2 decimal places.) Multiple Choice $216,923. $213,923. $210,923. $196,073. $201,773.

Actual materials used in kilograms 22100 =24000-1900 Standard cost actual materials…

Answered: Machine Builders Incorporated adopted a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Q39

Machine Builders Incorporated adopted a standard cost system several years ago that it uses in conjunction with its process cost system. The per-unit standard costs for direct materials and direct labor for its single product are as follows:

Materials:(5 kilograms × $9 per kilogram)	$ 45
Labor:(4 hours × $21 per hour)	$ 84

All materials are issued at the beginning of processing. The operating data shown below were taken from the records for July:

In-process beginning inventory	none
In-process ending inventory—90% complete as to labor	1,000	units
Units completed during the month	7,900	units
Budgeted output	8,600	units
Purchases of materials, in kilograms (AQ)	24,000
Total actual labor costs incurred	$ 520,000
Direct labor hours worked (AQ)	27,000	hours
Materials purchase-price variance	$ 3,200	unfavorable
Increase in materials inventory in July	1,900	kilograms
Beginning inventory of materials	0	kilogram

The actual total cost of direct materials used in production during July, to the nearest dollar, was: (Round your final calculation to 2 decimal places.)

Multiple Choice

$216,923.
$213,923.
$210,923.
$196,073.
$201,773.

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

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