The following data were taken from the records of a Company: Raw Materials Inventory, 09/30/2011 - $50,000 Work in Progress, 08/31/2011 - $80,000 Work in Progress, 09/30/2011 - $95,000 Finished Goods, 08/31/2011 - $60,000 Finished Goods, 09/30/2011 - $78,000 Raw materials purchases, $46,000 Factory overhead, 75% of direct labor cost, $63,000 Selling and administrative expenses, 12.5% of sales, $25,000 Net income for September 2011, $25,000 What is the cost of raw materials inventory on August 31, 2011?
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
The following data were taken from the records of a Company:
Raw Materials Inventory, 09/30/2011 - $50,000
Work in Progress, 08/31/2011 - $80,000
Work in Progress, 09/30/2011 - $95,000
Finished Goods, 08/31/2011 - $60,000
Finished Goods, 09/30/2011 - $78,000
Raw materials purchases, $46,000
Factory overhead, 75% of direct labor cost, $63,000
Selling and administrative expenses, 12.5% of sales, $25,000
Net income for September 2011, $25,000
What is the cost of raw materials inventory on August 31, 2011?
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