Brown Corporation Produced 2,200 Units During the Most Recent Period

question 9

Multiple Choice

Brown Corporation produced 2,200 units during the most recent period.Brown's costs were as follows: $\begin{array}{lr}\text { Direct material } & \$ 1,000 \\\text { Direct labor } & 2,000 \\\text { Variable manufacturing overhead } & 500 \\\text { Variable marketing and sales } & 300 \\\text { Fixed manufacturing overhead } & 900 \\\text { Fixed marketing and sales } & 400\end{array}$ If Brown uses absorption costing, what amount per unit would be included in ending inventory?

• A)$2.32
• B)$1.73
• C)$2.00
• D)$1.36
• E)$2.14

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Definitions:

Inventory Costing Methods

Techniques used to calculate the cost of inventory, including First-In, First-Out (FIFO), Last-In, First-Out (LIFO), and Average Cost methods.

Subsidiary Inventory Ledger

The subsidiary ledger containing individual accounts for items of inventory.

Inventory Levels

The quantity of products or materials a company has in stock at any given time.

Physical Inventory

The process of counting by hand all physical inventory items in a business at a specific point in time, to ensure accuracy of accounting records.