Neef Corporation has provided the following data for its two most recent years of operation: Selling price per unit$84Manufacturing costs: Variable manufacturing cost per unit produced: Direct materials$12Direct labor$5Variable manufacturing overhead$4Fixed manufacturing overhead per year$432,000 Selling and administrative expenses: Variable selling and administrative expense per unit sold$5Fixed selling and administrative expense per year$61,000 Year 1 Year 2Units in beginning inventory0 3,000Units produced12,000 9,000Units sold9,000 10,000Units in ending inventory3,000 2,0000 Which of the following statements is true for Year 1? The amount of fixed manufacturing overhead deferred in inventories is $108,000 The amount of fixed manufacturing overhead released from inventories is $108,000 The amount of fixed manufacturing overhead deferred in inventories is $513,000 The amount of fixed manufacturing overhead released from inventories is $513,000

Overhead cost are those cost which are not directly linked to production of a product but are…

Answered: Neef Corporation has provided the…

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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Neef Corporation has provided the following data for its two most recent years of operation:


Selling price per unit	$	84
Manufacturing costs:
Variable manufacturing cost per unit produced:
Direct materials	$	12
Direct labor	$	5
Variable manufacturing overhead	$	4
Fixed manufacturing overhead per year	$	432,000
Selling and administrative expenses:
Variable selling and administrative expense per unit sold	$	5
Fixed selling and administrative expense per year	$	61,000

	Year 1	Year 2
Units in beginning inventory	0	3,000
Units produced	12,000	9,000
Units sold	9,000	10,000
Units in ending inventory	3,000	2,0000

Which of the following statements is true for Year 1?

		The amount of fixed manufacturing overhead deferred in inventories is $108,000
		The amount of fixed manufacturing overhead released from inventories is $108,000
		The amount of fixed manufacturing overhead deferred in inventories is $513,000
		The amount of fixed manufacturing overhead released from inventories is $513,000

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