Table 6-4
Assume the Following Data for Burnette Sales for 2019

question 130

Multiple Choice

Table 6-4
Assume the following data for Burnette Sales for 2019: $$\begin{array} { | c | l | } \hline \text { Beginning inventory } & 10 \text { units at } \$ 7 \text { each } \\\hline \text { March } 18 \text { purchase } & 15 \text { units at } \$ 9 \text { each } \\\hline \text { Sale } & 20 \text { units at } \$ 15 \text { each } \\\hline \text { June } 10 \text { purchase } & 20 \text { units at } \$ 10 \text { each } \\\hline \text { Sale } & 12 \text { units at } \$ 15 \text { each } \\\hline \text { October } 30 \text { purchase } & 12 \text { units at } \$ 11 \text { each } \\\hline \text { Sale } & 10 \text { units at } \$ 16 \text { each } \\\hline\end{array}$$ On December 31, a physical count reveals 15 units on hand.
-Refer to Table 6-4. Under the FIFO method (assuming a perpetual inventory system) , ending inventory would be valued at:

• A)$162.
• B)$105.
• C)$115.
• D)$135.

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Definitions:

Margin of Safety

The difference between actual sales and the break-even point, indicating the level of risk in not covering fixed costs.

Composite Units

A measure used in costing to represent a bundle or mix of goods or services treated as a single unit.

Break-Even Point

The financial state in which total costs equal total revenues, resulting in neither profit nor loss.

Variable Cost

Costs that vary directly with the level of production or volume of services provided.