Lakatos Corporation Manufactures One Product

question 416

Multiple Choice

Lakatos Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs. There is no variable manufacturing overhead. The standard cost card for the company's only product contains the following information concerning direct materials: During the year, the company completed the following transactions concerning direct materials:a. Purchased 151,800 kilos of raw material at a price of $9.70 per kilo.b. Used 140,870 kilos of the raw material to produce 38,100 units of work in process.The company calculated the following direct materials variances for the year:
Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation.
When recording the raw materials used in production in transaction (b) above, the Raw Materials inventory account will increase (decrease) by:

• A) $1,366,439
• B) $1,267,830
• C) ($1,366,439)
• D) ($1,267,830)

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Definitions:

Brain Size

A measure of the volume or mass of the brain, often related to an organism's cognitive abilities, but not the sole determinant of intelligence.

Dentition

Refers to the development, arrangement, and number of teeth in animals and humans.

Homo Heidelbergensis

An extinct species of archaic humans that lived approximately 600,000 to 200,000 years ago, known for their large braincase and robust build.

Homo Erectus

An extinct species of human that lived between 1.9 million and 143,000 years ago, known for their upright walking ability.