Legend Company Manufacturers Tables

question 100

Multiple Choice

Legend Company manufacturers tables. If raw material used was $80,000 and Raw Material Inventory at the beginning and end of the period, respectively, was $17,000 and $21,000, what was amount of raw material was purchased?

• A) $76,000
• B) $118,000
• C) $84,000
• D) $101,000

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Definitions:

Conversion Cost

Conversion cost is the sum of direct labor and manufacturing overhead costs, representing the total cost to transform raw materials into finished goods.

Fixed Overhead

Costs that do not vary with the level of production or sales volume, including rent, salaries, and insurance.

Monthly Lease Payments

Regular payments made for the use of property or equipment over a set period, typically agreed upon in a lease contract.

Production Equipment

The machinery and tools used in the production process to manufacture products.