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3 August, 12:03

The following data (in thousands of dollars) have been taken from the accounting records of Karmint Corporation for the just completed year: sales - $830; raw materials inventory, beginning - $50, raw materials inventory, ending - $40; purchases of raw materials - $150; direct labor - $140: manufacturing overhead - $160; administrative expenses - $120; selling expenses - $150; work in process inventory, beginning - $30; work in process inventory, ending - $50; finished goods inventory, beginning - $80; finished goods inventory, ending - $100. The cost of the raw materials used in production during the year (in thousand of dollars) was:A) $190. B) $160. C) $140. D) $200.

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  1. 3 August, 12:19
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    The correct answer is B: Cost of raw material = $160

    Explanation:

    Giving the following information:

    Sales = $830

    Raw materials inventory, beginning = $50.

    Raw materials inventory, ending = $40.

    Purchases of raw materials = $150.

    Direct labor = $140.

    Manufacturing overhead = $160.

    Administrative expenses = $120.

    Selling expenses = $150.

    Work in process inventory, beginning = $30

    Work in process inventory, ending = $50.

    Finished goods inventory, beginning = $80.

    Finished goods inventory, ending = $100.

    Cost of raw material = Raw materials inventory, beginning + Purchases of raw materials - Raw materials inventory, ending

    Cost of raw material = 50 + 150 - 40 = $160
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