Win Corporation sells a single product. Budgeted sales for the year are anticipa

Question

Win Corporation sells a single product. Budgeted sales for the year are anticipated to be 699,181 units, estimated beginning inventory is 106,205 units, and desired ending inventory is 80,242 units. The quantities of direct materials expected to be used for each unit of finished product are given below. Material A .50 lb. per unit @ $0.56 per pound Material B 1.00 lb. per unit @ $2.25 per pound Material C 1.20 lb. per unit @ $0.90 per pound What is the dollar amount of direct material C used in production during the year? Select the correct answer. $195,771 $188,501 $727,075 $1,514,741

Explanation / Answer

First we need to calculate production to apply the norms of Material C

Production = Sales + Closing stock -Opening Stock

                 = 699,181 + 80,242 - 106,205

                 =673,218 units

Material C consumed would be

= 1.20 lb x 673,218 units x $0.90 per lb

=$727075.44 rounded off to $727075

Related Questions

Navigate

• Browse (All)
• Browse W
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.