Multiple choice

Opening stock of raw materials Rs. 1, 00, 000. closing stock of materials Rs. 2, 00, 000, purchases Rs. 3, 00, 000, carriage inward Rs. 10, 000, freight outward Rs. 5, 000. Purchase returns Rs. 20, 000, the cost of raw aterials consumed is

  1. Rs. 1, 95, 000

  2. Rs. 1, 90, 000

  3. Rs. 2, 10, 000

  4. none of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Cost of raw materials consumed = Opening stock + Purchases + Carriage inward - Purchase returns - Closing stock = Rs. 1,00,000 + Rs. 3,00,000 + Rs. 10,000 - Rs. 20,000 - Rs. 2,00,000 = Rs. 1,90,000. Note that freight outward (Rs. 5,000) is a selling expense, not part of material cost. Option B is correct.

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