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In July, Econo Company purchased materials costing $21,000 and incurred direct labor cost of $18,000. Overhead totaled $32,000 for the month. Information on inventories was as follows:
July 1 July 31
Materials $6,200 $7,100
Work in process $ 700 $1,200
Finished goods $3,300 $2,700
Problem 1: What was the cost of direct materials used in July?
A. $21,000
B. $20,100
C. $21,900
D. $20,500
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