The Following Cost Data Pertain to the Operations of Ladwig

question 183

Multiple Choice

The following cost data pertain to the operations of Ladwig Department Stores, Inc., for the month of December.
The Brentwood Store is just one of many stores owned and operated by the company. The Shoe Department is one of many departments at the Brentwood Store. The central warehouse serves all of the company's stores.
-What is the total amount of the costs listed above that are direct costs of the Shoe Department?

• A) $66,000
• B) $74,000
• C) $106,000
• D) $71,000

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Definitions:

FOB Shipping Point

A shipping term indicating that the buyer assumes responsibility for the goods and the cost of transportation as soon as the goods leave the seller's premises.

Freight Costs

Expenses associated with transporting goods from one place to another, including the costs of shipping, handling, and insurance of goods during transit.

Perpetual Inventory System

A method of inventory management that records real-time transactions of goods, maintaining continuous inventory balance.

Journal Entries

The recordation of financial transactions in a journal in such a way that each transaction is accompanied by a brief explanatory note or description.