A Company Has the Following Information for Its First Month

question 102

Multiple Choice

A company has the following information for its first month of operations: $\begin{array}{lr}\text { Raw materials used } & \$ 25,000 \\\text { Sales ( } \$ 65 \text { per unit) } & \$ 78,000 \\\text { Direct labor } & \$ 42,000 \\\text { Variable factory overhead } & \$ 17,000 \\\text { Fixed factory overhead } & \text { unknown }\\\text { Variable selling and }\\\text { administrative } & \$ 3,000 \\\text { Fixed selling and administrative } & \$ 5,000 \\\text { Gross profit } & \$ 30,000 \\\text { Contribution margin } & \text { unknown }\\\text { Ending inventories: }\\\text { Raw materials } & \$ 7,000 \\\text { WIP } & \text { none } \\\text { Finished goods } & 1,200 \text { units }\end{array}$ is the inventory cost per unit using variable costing.

• A) $36.25
• B) $35.00
• C) $37.92
• D) $65.00

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Definitions:

Creative

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