The Cost of Merchandise Sold from the Following Data Is

question 6

Multiple Choice

The cost of merchandise sold from the following data is as follows: sales $80,000, beginning inventory $5,000, purchases $21,800, purchase discounts $790, ending inventory $5,100.

• A) $21,560
• B) $20,190
• C) $20,910
• D) $21,650
• E) None of these

---

Definitions:

Direct Labor

The workforce costs directly involved in producing a product or delivering a service, excluding indirect labor expenses.

Differential Cost

The variance in overall expenses incurred when choosing one option instead of another.

Relevant Costs

Costs that will be affected by a decision and hence should be considered in the decision-making process.

Milling Machine Constraint

A limitation or bottleneck in the production process caused by the capacity or capability of the milling machine.