During July,the equivalent units of direct materials added to the product worked on by Department A amounted to a total of 90,000 applied as follows: beginning inventory,20,000 units;units started and completed in July,60,000 units;and ending inventory,10,000 units.Assuming that the cost of direct materials requisitioned by the department in July was $135,000;the amount of the materials cost to be assigned to the ending inventory would be: (Do not round intermediate calculations. )
A)$16,875.
B)$54,000.
C)$15,000.
D)$18,000.

Question

Quizplus · Accepted Answer

The cost per unit of direct materials is calculated as $135,000 / 90,000 units = $1.50 per unit. The ending inventory consists of 10,000 units, so the materials cost assigned to the ending inventory is 10,000 units * $1.50/unit = $15,000.

During July,the Equivalent Units of Direct Materials Added to the Product