Lincoln Plastics manufactures custom park furniture and signage from recycled plastics $($primarily shredded milk jugs$).$ Many of the company's customers are municipalities that are required by law to purchase goods that meet certain recycled$-$content guidelines. $($Recycled$-$content can include post$-$consumer waste materials, pre$-$consumer waste materials, and recovered materials$).$ As a result, Lincoln includes two types of direct material charges in its job cost for each job: $(1)$ virgin materials $($non$-$recycled$),$ and $(2)$ recycled$-$content materials.

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