Raw materials purchased $254,000 Beginning raw materials inventory 12,000 Ending raw materials inventory 7,900 Direct labor incurred 51,000 Indirect materials requisitioned and used 4,000 Actual manufacturing overhead costs 36,800 Beginning work-in-process inventory 15,100 Ending work-in-process inventory 12,000 How much is the cost of direct materials used in production? Please show which amounts were added/subtracted to get the correct answer.
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
| Raw materials purchased | $254,000 |
| Beginning raw materials inventory | 12,000 |
| Ending raw materials inventory | 7,900 |
| Direct labor incurred | 51,000 |
| Indirect materials requisitioned and used | 4,000 |
| Actual |
36,800 |
| Beginning work-in-process inventory | 15,100 |
| Ending work-in-process inventory | 12,000 |
How much is the cost of direct materials used in production?
Please show which amounts were added/subtracted to get the correct answer.
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