During its first year of operations, Nexus Electronics Co. incurred the following manufacturing costs: • • • Direct materials: $8 per unit Direct labor: $6 per unit Variable overhead: $7 per unit • Fixed overhead: $400,000 The company produced 40,000 units and sold 35,000 units, leaving 5,000 units in inventory at year-end. What is the value of ending inventory under variable costing?

During its first year of operations, Nexus Electronics Co. incurred the following manufacturing costs: • • • Direct materials: $8 per unit Direct labor: $6 per unit Variable overhead: $7 per unit • Fixed overhead: $400,000 The company produced 40,000 units and sold 35,000 units, leaving 5,000 units in inventory at year-end. What is the value of ending inventory under variable costing?

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 25E: Last year, Orsen Company produced 25,000 juicers and sold 26,500 juicers for 60 each. The actual...

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Bethany Company has just completed the first month of producing a new product but has not yet shipped any of this product. The product incurred variable manufacturing costs of 5,000,000, fixed manufacturing costs of 2,000,000, variable marketing costs of 1,000,000, and fixed marketing costs of 3,000,000. Under the variable costing concept, the inventory value of the new product would be: a. 5,000,000. b. 6,000,000. c. 8,000,000. d. 11,000,000.
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During its first year of operations, the McCormick Company incurred the following manufacturing costs: Direct materials, $7 per unit, Direct labor, $4 per unit, Variable overhead, $3 per unit, and Fixed overhead, $250,000. The company produced 37,000 units and sold 22,000 units, leaving 7,500 units in inventory at year-end. What is the value of ending inventory under variable costing?
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During its first year of operations, the McCormick Company incurred the following manufacturing costs: Direct materials, $4 per unit, Direct labor, $2 per unit, Variable overhead, $3 per unit, and Fixed overhead, $256,000. The company produced 32,000 units, and sold 26,500 units, leaving 5,500 units in inventory at year-end. What is the value of ending inventory under absorption costing? Multiple Choice $44,000 $49,500 $93,500 $256,000 $305,500