Problem:
The Outdoor Manufacturing Company produces sporting equipment. The company maintains a single raw materials inventory account for both direct and indirect materials. The following information came from the factory ledger accounts for December:
|
Raw Materials, December 1
|
$ 45,500
|
|
Work in Process, December 1
|
125,000
|
|
Finished Goods, December 1
|
175,000
|
|
Raw materials purchases (during December)
|
623,000
|
|
Direct labor
|
435,000
|
|
Repairs and maintenance
|
37,200
|
|
Indirect materials
|
16,700
|
|
Utilities
|
63,200
|
|
Indirect labor
|
38,200
|
|
Supervisors' salaries
|
18,300
|
|
Raw Materials, December 31
|
43,600
|
|
Work in Process, December 31
|
135,000
|
|
Finished Goods, December 31
|
150,000
|
Compute the cost of direct materials used during the month of December.