Dillon Corporation applies manufacturing overhead to jobs using a predetermined overhead rate of 75% of direct labor cost. Any under or overapplied manufacturing overhead cost is closed out to Cost of Goods Sold at the end of the month. During May, the following transactions were recorded by the company: Raw materials (all direct materials): Purchased during the month $38,000 Used in production $35,000 Labor: Direct labor-hours worked during the month 3,150 Direct labor cost incurred $30,000 Manufacturing overhead cost incurred $24,500 Direct labor cost included in May 31 work in process $4,400 Inventories: Raw materials (all direct), May 31 $8,000 Work in process, May 1 $9,000 Work in process, May 31 $12,000 The balance on May 1 in the Raw Materials inventory account was:

Select one:

a. $7,000

b. $9,000

c. $5,000

d. $11,000

Clear my choice

Fifo Method