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Cha of the South, Inc., a manufacturer of bottled sweet tea, had the and ending inventories for the vear ended December 31, 2013 January 1 December 31 Raw Materials Inventory Work in Process Inventory Finished Goods Inventory $10,000 $18,63 521,000 6,01 $17,000 516,500 Raw Materials Inventory consists of both direct material and indirect material. During the year, direct labor costs of $30,000 were incurred, manufacturing overhead totaled $42,000, materials purchased were $27,000, and selling and administrative costs were $22,000. Champagne sold 25,000 units of product during the year at a sales price of $5.00 per unit. What were the total manufacturing costs for the year assuming $2,737 of indirect materials were used during the period? The total manufacturing costs for the year were S

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Answer:

Direct material used = Beginning raw material inventory + Material purchased - Ending raw material inventory – Indirect Materials
Direct material used = $10,000 + $27,000 - $6,018 - $2,737
Direct material used = $28,245

Total Manufacturing Cost = Direct Materials used + Direct Labor + Manufacturing Overhead
Total Manufacturing Cost = $28,245 + $30,000 + $42,000
Total Manufacturing Cost = $100,245

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