CALCU Basil Industries reported the following information for December: Beginnin

Question

CALCU Basil Industries reported the following information for December: Beginning balance, Raw Materials Inventory Beginning balance, Work in process Inventory Beginning balance, Finished Goods Inventory Purchases of raw materials Factory electricity Direct labor payroll Depreciation on factory equipment Insurance on factory building Indirect materials used in production Total raw materials used in production Indirect labor payrol Cost of goods manufactured Cost of goods sold $187,500 300,000 106,250 337,500 62,500 200,000 218,750 50,000 43,750 406,250 150,000 1,250,000 1,312,500 What was the cost of the direct materials used by Basil in production? $381,250 $362,500 $450,000 $406.250

Explanation / Answer

D.$406,250.

Total raw materials used in production is given readily.

Raw materials qualify as direct materials.

Indirect materials do not qualify for this.

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