ECONOMICS

Detailed explanation-1: -To calculate the material cost, multiply the total quantity of material by the cost per unit of material.

Detailed explanation-2: -Direct materials. Add the total cost of materials purchases in the period to the cost of beginning inventory, and subtract the cost of ending inventory. The result is the cost of direct materials incurred during the period.

Detailed explanation-3: -To calculate total manufacturing cost you add together three different cost categories: the costs of direct materials, direct labour and manufacturing overheads. Expressed as a formula, that’s: Total manufacturing cost = Direct materials + Direct labour + Manufacturing overheads.