Star LLC sells three products-X, Y, Z. The following information was available at the year- end: X Y Z $ per unit $ per unit $ per unit Original cost 10 11 12 Estimated selling price 15 14 15 Agent’s commission fee (sales-related cost) 7 2 4 Units of inventory 20 30 10 The value of inventory at the year-end should be: A. $650 B. $600 C. $725 D. $855
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Star LLC sells three products-X, Y, Z. The following information was available at the year-
end:
X Y Z
$
per unit
$
per unit
$
per unit
Original cost 10 11 12
Estimated selling price 15 14 15
Agent’s commission fee (sales-related cost) 7 2 4
Units of inventory 20 30 10
The value of inventory at the year-end should be:
A. $650
B. $600
C. $725
D. $855
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