Chapter 7, Problem 4CMA

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:

1. a. $5,000,000.
2. b. $6,000,000.
3. c. $8,000,000.
4. d. $11,000,000.