Direct Materials Used Banana Bakers makes chocolate chip cookies for cafe restau

Question

Direct Materials Used Banana Bakers makes chocolate chip cookies for cafe restaurants. In June, Hannah Banana purchased $26,000 of materials. On june 1, the materials inventory was $5,980 ? Hannah June 30, $2,093 of materials remained in materials inventory Required: 1. What is the cost of the direct materials used in production during June? 2. There is a difference between the cost of direct materials that were purchased during the month and the cost of direct materials that were used in production during the month. In context which of the following is true. Previous N Check My Work 3 more Check My Work uses remaining

Explanation / Answer

1)Direct Material used

material used can be calculated from following formula with given data:

Opening inventory.........................................:5,980

plus:Purchased Material..............................:26,000

Less:Material Used (as balancing figueB):(29,887)

gives Closing Inventory..................................:2,093

calculation=(5980+26000-2093)=29,887

2) From above it is clear 26,000 is purchase but used 29,887

that is a difference of :"3887"

(If the option has different statement please feel free to comment)

Jet skis sold

using the same form of formula in question 1 but different components.

opening stock:27,260

Add;Manufactured:94,000

Less:Units Sold :(89,911) Balancng figure

closing stock:31,349

Calculation-(27260+94000-31349)=89,911

Cost of goods sold= units sold *$3600(cost per unit)

=89911 * 3600 =$32,367,600

(if cost of producing one unit is 3600 for 89,911 units sold will be $3600*89,911)

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