Why Choose Us?
0% AI Guarantee
Human-written only.
24/7 Support
Anytime, anywhere.
Plagiarism Free
100% Original.
Expert Tutors
Masters & PhDs.
100% Confidential
Your privacy matters.
On-Time Delivery
Never miss a deadline.
Cape Corporation sells a single product
Cape Corporation sells a single product. Budgeted sales for the year are anticipated to be 640,000 units, estimated beginning inventory is 98,000 units, and desired ending inventory is 80,000 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. @ $0.60 per pound
Material B1.00 lb. per unit @ $1.70 per pound
Material C1.20 lb. per unit @ $1.00 per pound
The amount of direct material B purchased during the year is:
a.$1,390,600.
b.$1,088,000.
c.$1,057,400.
d.$1,224,000.
Expert Solution
Computation of Amount of Direct Material B purchased during the year:
Total purchases = Sales + Closing inventory - Beginning inventory = 640,000 + 80,000 - 98,000 = 622,000 units
For Material B:
1 lb. for every unit @1.70 per pound
Total pound used = 622,000 pounds
So,
Amount of Direct Material B purchased during the year = 622,000*1.7 = $1,057,400
So, the correct option is C "$1,057,400".
Archived Solution
You have full access to this solution. To save a copy with all formatting and attachments, use the button below.
For ready-to-submit work, please order a fresh solution below.
