Andrew Industries purchased $165,000 of raw materials on account during the month of March.The beginning Raw Materials Inventory balance was $22,000,and the materials used to complete jobs during the month were $141,000 direct materials and $13,000 indirect materials.What is the ending Raw Materials Inventory balance for March?

Question

Quizplus · Accepted Answer

The total raw materials available for use during the month were $165,000 beginning balance + $165,000 purchases = $330,000. The total raw materials used during the month were $141,000 direct materials + $13,000 indirect materials = $154,000. Therefore, the ending Raw Materials Inventory balance can be calculated as $330,000 - $154,000 = $176,000. However, this includes both direct and indirect materials, so we need to subtract the indirect materials to get the ending balance for raw materials only. $176,000 - $13,000 = $163,000. Finally, we need to subtract the beginning balance of $22,000 to get the ending Raw Materials Inventory balance of $163,000 - $22,000 = $141,000.

Andrew Industries Purchased $165,000 of Raw Materials on Account During