Inventory Management – Short Answer

Practice Question

Intro to Managerial Accounting
Inventory Management
Short Answer

If a company starts the year with $10,000 in raw materials and purchases an additional $50,000, what will be the ending raw materials inventory if $30,000 is used during the year?

Answer +
Correct Answer: $30,000
Explanation +

Ending Raw Materials = Beginning Inventory + Purchases – Used = $10,000 + $50,000 – $30,000 = $30,000.

This calculation is vital for inventory management (Page 51).