On January 1, 2015, Frederic Manufacturing Had a Beginning Balance

question 56

Multiple Choice

On January 1, 2015, Frederic Manufacturing had a beginning balance in Work-in-Process Inventory of $160,000 and a beginning balance in Finished Goods Inventory of $20,000. During the year, Frederic incurred manufacturing costs of $200,000. During the year, the following transactions occurred:
Job C-62 was completed for a total cost of $140,000 and was sold for $155,000.
Job C-63 was completed for a total cost of $180,000 and was sold for $210,000.
Job C-64 was completed for a total cost $80,000 but was not sold as of year-end.
The Manufacturing Overhead account had an unadjusted credit balance of $24,000, and was cleared to zero at year-end.
What was the amount of gross profit reported by Frederic at the end of the year?

• A)$21,000
• B)$69,000
• C)$201,000
• D)$161,000

---

Definitions:

Useful Life

Useful life is the estimated period over which an asset is expected to be usable for its intended purpose, affecting its depreciation or amortization schedules.

Differentiation Value

Refers to the unique benefits or characteristics of a product or service that set it apart from competitors in the eyes of customers.

Value-based Pricing

A pricing strategy where the price of a product or service is set based on the perceived or estimated value it provides to customers, rather than its cost of production.

Drill Press

A drill press is a machine tool used for drilling holes in various materials, offering precision and stability that handheld drills might not provide.