The following information is from the records of Stretch Limousines, Inc.: $\begin{array}{lc}
\text { Net direct materials purchase cost } & \$ 225,000 \
\text { Total direct materials used } & 275,000 \
\text { Beginning direct material s inventory } & 125,000
\end{array}$
The ending direct materials inventory is
A)$175,000.
B)$75,000.
C)$50,000.
D)$100,000.

Question

Quizplus · Accepted Answer

The ending direct materials inventory is calculated as: Beginning Inventory + Purchases - Materials Used = $125,000 + $225,000 - $275,000 = $75,000.

The Following Information Is from the Records of Stretch Limousines