Question

52. The ABC Company uses job costing.  In May, material requisitions were $44,000 ($40,000 of these direct),...

52. The ABC Company uses job costing.  In May, material requisitions were $44,000 ($40,000 of these direct), and raw material purchases were $56,600.  The end of month balance in raw materials inventory was $18,400.  What was the beginning raw materials inventory balance?

a.

$25,600

b.

$31,000

c.

None of the above

d.

$5,800

66. The CEO's salary is classified as a __________ cost

a.

product

b.

Finished Goods

c.

manufacturing overhead

d.

period
Business   Accounting   
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Answer #1

52.

Raw material purchases = $56,600

Ending raw materials inventory = $18,400

Beginning raw materials inventory = ?

Material requisitions = $44,000

Material requisitions = Beginning raw materials inventory + Raw material purchases - Ending raw materials inventory

44,000 = Beginning raw materials inventory + 56,600 - 18,400

Beginning raw materials inventory = $5,800

Correct option is (d)

66.

The CEO's salary is classified as a period cost.

Correct option is (d)

Product cost is incurred to make the product. It includes all direct and indirect manufacturing costs.

Period costs are non manufacturing costs.

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