Rock Shop Manufacturing Company makes specialty tools. In July,
Rock Shop incurred manufacturing costs of $4,000,000 for direct
materials, direct labour, and overhead. 30% of the total costs
represents overhead applied. The overhead rate is $1 for every
$0.50 of direct labour costs incurred. Inventory balances were:
July 1 / July 31
Raw materials $100,000 / $ 80,000
Work in process 90,000 / 95,000
Finished goods 120,000 / 130,000
Instructions
a) Determine the cost of raw materials purchased in July....