Mueller Company Reported the Following Data for the Year Just

question 17

Multiple Choice

Mueller Company reported the following data for the year just ended: $\begin{array}{lr}\text { Raw materials used in production } & \$ 800,000 \\\text { Direct labour } & \$ 700,000 \\\text { Total overhead costs } & \$ 900,000 \\\text { Ending work in process inventory } & \$ 400,000 \\\text { Cost of goods manufactured } & \$ 2,500,000\end{array}$ The beginning work in process inventory was:

• A)$500,000.
• B)$1,300,000.
• C)$100,000.
• D)$300,000.

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Definitions:

Fair Value Hedge

A hedge that protects against changes in the fair value of an asset, liability, or an unrecognized firm commitment that is attributable to a particular risk.

Forward Contract

A customized contract between two parties to buy or sell an asset at a specified price on a future date.

Annual Interest Rate

The percentage increase in the value of a loan or investment due to interest, calculated on an annual basis.

Present Value

The current worth of a future sum of money or stream of cash flows, given a specified rate of return.