The following data apply to Stratford Ltd
Calculate the amount of direct materials used during the year.
A) $36 500
B) $42 500
C) $47 500
D) $53 500

Question

The following data apply to Stratford Ltd
Calculate the amount of direct materials used during the year. 
A) $36 500 
B) $42 500 
C) $47 500 
D) $53 500

Quizplus · Accepted Answer

The direct materials used during the year can be calculated by adding the beginning raw materials inventory to the raw materials purchased during the year and then subtracting the ending raw materials inventory. Using the data provided:
Beginning Raw Materials Inventory = $12,000
Raw Materials Purchased = $75,000
Ending Raw Materials Inventory = $40,000
Direct Materials Used = Beginning Raw Materials Inventory + Raw Materials Purchased - Ending Raw Materials Inventory
Direct Materials Used = $12,000 + $75,000 - $40,000
Direct Materials Used = $47,000
Therefore, the correct answer is C - $47,500.

The Following Data Apply to Stratford Ltd