If there were 60, 000 pounds of raw materials on hand on January 1, 120, 000 pounds are desired for inventory at January 31, and 410, 000 pounds are required for January production, how many pounds of raw materials should be purchased in January?

INTRODUCTION TO COST ACCOUNTING

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

A	350, 000 pounds
B	530, 000 pounds
C	290, 000 pounds
D	470, 000 pounds

Explanation:

Detailed explanation-1: -Direct material for production= 410, 000 pounds.

Detailed explanation-2: -Subtract the cost of goods sold Finally, take the total costs of all finished goods and products sold over the set period and subtract that number from the sum of starting raw materials and raw materials purchased to calculate your raw materials inventory.

Detailed explanation-3: -Inventory is a current asset account found on the balance sheet, consisting of all raw materials, work-in-progress, and finished goods that a company has accumulated.

Detailed explanation-4: -The cost of raw materials purchased can therefore be calculated as follows: Raw Materials Purchased = (Ending Inventory – Beginning Inventory) + Cost of Goods Sold. A direct material purchases budget determines the quantity of material purchased within a production period.

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