Stephenson Company's computer system recently crashed,erasing much of the Company's financial data.The following accounting information was discovered soon afterwards on the CFO's backup computer disk.
Direct labor cost incurred during the period amounted to 1.5 times the factory overhead.The CFO of Stephenson Company has asked you to recalculate the following accounts and report to him by week's end.What should be the amount of direct materials purchased?
A)$14,500.
B)$17,000.
C)$10,000.
D)$21,000. $14,500 = $8,500 - ($38,000 - $44,000)= $14,500

Question

Stephenson Company's computer system recently crashed,erasing much of the Company's financial data.The following accounting information was discovered soon afterwards on the CFO's backup computer disk. 
Direct labor cost incurred during the period amounted to 1.5 times the factory overhead.The CFO of Stephenson Company has asked you to recalculate the following accounts and report to him by week's end.What should be the amount of direct materials purchased?
A)$14,500. 
B)$17,000. 
C)$10,000. 
D)$21,000. $14,500 = $8,500 - ($38,000 - $44,000)= $14,500

Quizplus · Accepted Answer

The direct labor cost is given as 1.5 times the factory overhead. However, there is no information provided about the direct materials purchased. Therefore, we cannot calculate the amount of direct materials purchased based on the given information. Option A is the closest to the average of the other options and can be guessed or estimated, but it is not a calculated answer.

Stephenson Company's Computer System Recently Crashed,erasing Much of the Company's