Allsop Company Had No Beginning Inventory

question 52

Multiple Choice

Allsop Company had no beginning inventory.The company purchases 300 units of inventory in January at $5 each,500 units at $4 each in August,and 200 units at $6 each in November.The company sells 150 units during the year.Allsop uses a periodic inventory system and the LIFO inventory costing method.What is the cost of goods sold?

• A) $600
• B) $934
• C) $750
• D) $900

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Definitions:

Factory Depreciation

A method of allocating the cost of a tangible asset over its useful life, specific to equipment and buildings used in manufacturing.

Direct Labor

The labor costs directly associated with the production of goods or services, such as wages for workers on the assembly line.

Total Manufacturing Costs

The sum of all costs directly associated with the production of goods, including direct materials, direct labor, and manufacturing overhead.

Cost Of Goods Manufactured

The total cost of producing goods during a specific period, including labor, material, and overhead costs, ready for sale.