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Steele Corporation has the following information for January, February, and March: January February March Units produced 10,000 10,000 10,000 Units sold 7,000 8,500 10,500 Production costs per unit (based on 10,000 units) are as follows: Direct materials $12 Direct labor 8 Variable factory overhead 6 Fixed factory overhead 4 Variable selling and admin expenses 10 Fixed selling and admin expenses 4 There were no beginning inventories for January, and all units were sold for $50. Costs are stable over the three 10 months. What is the February ending inventory for Steele Corporation using the absorption costing method? a. $39,000 b. $45,000 c. $135,000 d. $300,000

Steele Corporation has the following information for January, February, and March: January February March Units produced 10,000 10,000 10,000 Units sold 7,000 8,500 10,500 Production costs per unit (based on 10,000 units) are as follows: Direct materials $12 Direct labor 8 Variable factory overhead 6 Fixed factory overhead 4 Variable selling and admin expenses 10 Fixed selling and admin expenses 4 There were no beginning inventories for January, and all units were sold for $50. Costs are stable over the three 10 months. What is the February ending inventory for Steele Corporation using the absorption costing method? a. $39,000 b. $45,000 c. $135,000 d. $300,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Steele Corporation has the following information for January, February, and March: January February March Units produced 10,000 10,000 10,000 Units sold 7,000 8,500 10,500 Production costs per unit (based on 10,000 units) are as follows: Direct materials $12 Direct labor 8 Variable factory overhead 6 Fixed factory overhead 4 Variable selling and admin expenses 10 Fixed selling and admin expenses 4 There were no beginning inventories for January, and all units were sold for $50. Costs are stable over the three 10 months. What is the February ending inventory for Steele Corporation using the absorption costing method? a. $39,000 b. $45,000 c. $135,000 d. $300,000
Transcribed Image Text:Steele Corporation has the following information for January, February, and March: January February March Units produced 10,000 10,000 10,000 Units sold 7,000 8,500 10,500 Production costs per unit (based on 10,000 units) are as follows: Direct materials $12 Direct labor 8 Variable factory overhead 6 Fixed factory overhead 4 Variable selling and admin expenses 10 Fixed selling and admin expenses 4 There were no beginning inventories for January, and all units were sold for $50. Costs are stable over the three 10 months. What is the February ending inventory for Steele Corporation using the absorption costing method? a. $39,000 b. $45,000 c. $135,000 d. $300,000
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