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Problem - Hannah Banana Bakers makes chocolate chip cookies for cafe restaurants. In June, Hannah Banana purchased $15,500 of materials. On June 1, the materials inventory was $3,700. On June 30, $1,600 of materials remained in materials inventory.
Required -
1. What is the cost of the direct materials used in production during June?
2. Briefly explain why there is a difference between the cost of direct materials that were purchased during the month and the cost of direct materials that were used in production during the month.
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