Use the following information to answer queslle A product is sold for $75 each with unit cost of direct materials $20, direct labor $15, variable manufacturing overhead $12, and fixed manufacturing overhead $10. The volume produced and sold is 6,000 units. Variable and fixed marketing and administrative costs are $4 and $3, respectively. 4. Which of the following statements is correct? a. Prime cost is $35. b. Conversion cost is $37. c. Inventoriable cost is $57. d. All of the above. 5. What is the amount of cost of goods sold? a. $342,000 b. $201,500 c. $364,000 d. None of the above. 6. Which of the following statements is correct? a. Operating profit is $66,000. is $108.000

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Use the following information to answer questions 4 through 7:
A product is sold for $75 each with unit cost of direct materials $20, direct labor $15, variable
manufacturing overhead $12, and fixed manufacturing overhead $10. The volume produced and
sold is 6,000 units. Variable and fixed marketing and administrative costs are $4 and $3,
respectively.
4. Which of the following statements is correct?
a. Prime cost is $35.
b. Conversion cost is $37.
c. Inventoriable cost is $57.
d. All of the above.
5. What is the amount of cost of goods sold?
a. $342,000
b. $201.500
c. $364,000
d. None of the above.
6. Which of the following statements is correct?
a. Operating profit is $66,000.
b. Gross margin is $108,000.
c.
Contribution margin is $144,000.
d. All of the above.
Transcribed Image Text:Use the following information to answer questions 4 through 7: A product is sold for $75 each with unit cost of direct materials $20, direct labor $15, variable manufacturing overhead $12, and fixed manufacturing overhead $10. The volume produced and sold is 6,000 units. Variable and fixed marketing and administrative costs are $4 and $3, respectively. 4. Which of the following statements is correct? a. Prime cost is $35. b. Conversion cost is $37. c. Inventoriable cost is $57. d. All of the above. 5. What is the amount of cost of goods sold? a. $342,000 b. $201.500 c. $364,000 d. None of the above. 6. Which of the following statements is correct? a. Operating profit is $66,000. b. Gross margin is $108,000. c. Contribution margin is $144,000. d. All of the above.
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