Moss Co Uses the FIFO Method to Calculate Ending Inventory

question 50

Multiple Choice

Moss Co. uses the FIFO method to calculate ending inventory. Assuming 300 units are not sold, the cost of goods sold is:

• A)$7,600
• B)$7,280
• C)$3,120
• D)$3,400
• E)None of these

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Definitions:

Direct Labor-Hours

The total hours worked by employees who are directly involved in the production process, used for calculating labor costs and efficiency.

Plantwide Predetermined Overhead

An overhead rate calculated for an entire manufacturing plant, applied to all products regardless of the specific department in which they were produced.

Machine-Hours

A measure of production activity that quantifies the number of hours machines are operated in the manufacturing process.

Mark Up

The percentage added to the cost price of goods to cover overhead and profit.