Neuhaus Corporation Manufactures One Product

question 34

Multiple Choice

Neuhaus 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 is as follows:
During the year, the company completed the following transactions:
a. Purchased 52,900 gallons of raw material at a price of $7.60 per gallon.
b. Used 46,820 gallons of the raw material to produce 27,600 units of work in process.
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 purchases in transaction (a) above,the Raw Materials inventory account will increase (decrease) by:

• A) $396,750
• B) ($402,040)
• C) $402,040
• D) ($396,750)

---

Definitions:

Sunshine Laws

Laws that require certain proceedings of government agencies to be open or available to the public, aimed at promoting transparency and accountability.

Freedom Of Information Act

A law that allows for the full or partial disclosure of previously unreleased information and documents controlled by the United States government.

Government Information

Data, statistics, and other information produced or commissioned by governmental bodies or agencies, which can range from legislative documents to reports on the performance of government services.

Federal Bureaucracy

The collective agencies and employees of the executive branch of the U.S. government, responsible for implementing and administering federal laws and programs.