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Dodd Corporation used $90,000 of direct material, $112,000 of direct labor, and applied $104,000 of manufacturing overhead during July. Its beginning and ending work-in-process and finished goods inventories were as follows:

-The standard cost for direct material is $45,000 if the company produces 10,000 units of product.Actual direct materials used to produce 10,500 units of product amounted to $48,300.What is the standard cost for the direct material at the actual level of production.
A)$45,000
B)$46,000
C)$47,250
D)$48,300

Question

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Dodd Corporation used $90,000 of direct material, $112,000 of direct labor, and applied $104,000 of manufacturing overhead during July. Its beginning and ending work-in-process and finished goods inventories were as follows:
 
-The standard cost for direct material is $45,000 if the company produces 10,000 units of product.Actual direct materials used to produce 10,500 units of product amounted to $48,300.What is the standard cost for the direct material at the actual level of production.
A)$45,000 
B)$46,000 
C)$47,250 
D)$48,300

Quizplus · Accepted Answer

The standard cost for direct material per unit is $4.50 ($45,000/10,000 units). 
To find the standard cost for direct material at the actual level of production, we need to multiply the standard cost per unit by the actual number of units produced: 
$4.50 x 10,500 = $47,250. 
Therefore, the best choice is C.

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