What was the amount of Direct Materials and Direct labor used in May?

Woodcarving company incurred the following costs during May :

Conversion cost $ 479,500

Prime cost $ 406250

Manufacturing overhead $321500

Solutions

Expert Solution

Computation of the amount of Direct Material and Direct Labor used in May are as follows:

Given,

Prime Cost = $406,250

Conversion Costs = $479,500

Manufacturing Overhead = $321,500

Formulas,

Prime Cost = ( Direct Material + Direct Labor )

Coversion Cost = ( Direct labor + Manufacturing Overhead )

Conversion Cost = Direct labor + Manufacturing Overhead

=> $479,500 = Direct Labor + $321,500

=> Direct labor = $479500 - $321,500

=> Direct Labor = $158000

2. Prime Cost = Direct Material + Direct Labor

=> $406250 = Direct material + $158000

=> Direct Material = $406250 - $158000

=> Direct Material = $248250

Answer:

The amount of direct material and direct labor used in May are :

c. Direct Material $248250 ; Direct labor $158000

Answer : Option C

c. Direct Material $248250 ; Direct labor $158000

S Mahalaxmi answered 2 years ago

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