1. XYZ Manufacturing Inc.

Scenario: Analyze Material Costs

Data:

• Beginning Inventory: 5,000 units at $10 per unit
• Purchases:
  • January: 10,000 units at $12 per unit
  • March: 8,000 units at $15 per unit

• Usage:
  • 15,000 units used in production

Requirements:

1. Calculate the total material costs incurred during the period.
2. Determine the cost per unit of material used in production.
3. Analyze the impact of material cost fluctuations on XYZ Manufacturing's profitability.
4. Discuss strategies to optimize material costs without compromising quality.