Okaboji Manufacturing Company reported the following materia

Okaboji Manufacturing Company reported the following materials data for the month ending November 30:

Materials purchased $178,600

Materials inventory, Novermber 1 $56,400

Materials inventory, November 30 $47,000

Determine the cost of direct materials used in production by Okaboji during the month ended November 30.

Solution

cost of direct materials =( materials purchased + opening inventory-

                                                 closing inventory )

         given that :

                  materials purchased = $178,600

                  opening inventory     = $56,400

                  closing inventory      = $47,000

       cost of direct materials = ($178,600+$56,400-$47,000)

                                            = $188,000

the cost of direct materials used in production by Okaboji during the month ended Nov30 = $188,000