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24 February, 20:12

telmack Corporation, a manufacturing Corporation, has provided data concerning its operations for September. The beginning balance in the raw materials account was $20,000 and the ending balance was $27,000. Raw materials purchases during the month totaled $63,000. Manufacturing overhead cost incurred during the month was $53,000, of which $3,000 consisted of raw materials classified as indirect materials. The direct materials cost for September was:

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  1. 24 February, 20:30
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    Direct material = $51,000

    Explanation:

    Giving the following information:

    Beginning inventory = $20,000

    Ending inventory = $27,000.

    Raw materials purchases during the month totaled $63,000.

    $3,000 consisted of raw materials classified as indirect materials.

    First, we need to calculate the total raw material used in production:

    Raw material used = beginning inventory + purchases - ending inventory

    Raw material used = 20,000 + 63,000 - 27,000 = 54,000

    Now, the direct material used:

    Direct material = 54,000 - 3,000 = $51,000
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