The Following Information Relates to Charlin Industries for the Year

question 79

Multiple Choice

The following information relates to Charlin Industries for the year ending December 31, 2017, the company's first year of operations: $$\begin{array} { l r } \text { Units produced } & 100,000 \\\text { Units sold } & 80,000 \\\text { Units in ending inventory } & 20,000 \\\text { Fixed manufacturing overhead } & \$ 650,000\end{array}$$ How much fixed manufacturing overhead would be expensed in 2017 using variable costing?

• A)$520,000
• B)$130,000
• C)$650,000
• D)$0

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Definitions:

Work In Process Inventory

The valuation of partially finished goods that are still in the production process at the end of an accounting period.

First-In, First-Out

An inventory valuation method where the oldest inventory items are recorded as sold first, reflecting the flow of goods.

Conversion Cost

The sum of direct labor and manufacturing overhead costs, representing the expenses required to convert raw materials into finished products.

Mixing Department

A production area where ingredients or components are combined to produce a final product.