FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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General Accounting

Schemm Inc. regularly uses material F04E and currently has in stock
455 liters of the material, for which it paid $2,617 several weeks ago.
If this were to be sold as is on the open market as surplus material, it
would fetch $5.19 per liter. New stocks of the material can be
purchased on the open market for $5.79 per liter, but it must be
purchased in lots of 1,000 liters. Determine the relevant cost of 800
liters of the material to be used in a job for a customer.
a. $4,152
b. $5,790
c. $4,632
d. $4,361
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Transcribed Image Text:Schemm Inc. regularly uses material F04E and currently has in stock 455 liters of the material, for which it paid $2,617 several weeks ago. If this were to be sold as is on the open market as surplus material, it would fetch $5.19 per liter. New stocks of the material can be purchased on the open market for $5.79 per liter, but it must be purchased in lots of 1,000 liters. Determine the relevant cost of 800 liters of the material to be used in a job for a customer. a. $4,152 b. $5,790 c. $4,632 d. $4,361
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