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Axe Company's work-in-process inventory: direct materials

The following debits (credits) appeared in Axe Company's work-in-process inventory account for the month of March 2009:
March Description Amounts
1 Beginning Balance $2,000
31 Direct Materials $12,000
31 Direct Labor $8,000
31 Manufacturing Overhead $6,400
31 Transfer to Finished Goods ($24,000)
Axe Company applies overhead to jobs at a predetermined overhead application rate of 80% of direct labor cost. Job No. 9, the only job still in process at the end of March, has been charged with direct labor of $1,000. The amount of direct materials charged to Job No. 9 was

a $12,000
b $4,400
c $2,600
d $1,500

Solution Preview

The following debits (credits) appeared in Axe Company's work-in-process inventory account for the month of March 2009:
March Description Amounts
1 Beginning Balance $2,000
31 Direct Materials $12,000
31 ...

Solution Summary

The process for teasing out this amount is shown in two related schedules.

$2.19