Use the Information Below to Answer the Following Question(s)

question 85

Multiple Choice

Use the information below to answer the following question(s) .Samson Inc.expects to sell 10,000 barbells for $18.00 each.Direct materials costs are $5.00, direct manufacturing labour is $6.00, and manufacturing overhead is $2.50 per barbell.Each barbell requires 6 kilograms (kg) of material which is all added at the start of production.The units in work-in-process beginning and ending inventory were half complete as to direct labour and manufacturing overhead costs; the units in beginning inventory are completed before new units are started..Each barbell requires one-quarter hour of direct labour, and manufacturing overhead is allocated based on direct labour hours.Marketing costs are $2.00 per barbell.The following inventory levels are expected to apply to 2019:

-How many kilograms of material will need to be purchased for 2019 production and inventory requirements?

• A)60,900 kg.
• B)60,600 kg.
• C)60,300 kg.
• D)60,000 kg.
• E)62,100 kg.

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Definitions:

Bad Debt Expense

An estimated expense recognized by businesses for accounts receivable that are considered unlikely to be collected.

Salvage Value

The projected value of an asset when it reaches the end of its operational lifespan.

Useful Life

The estimated time period an asset is expected to be used by a company before it is no longer useful or becomes obsolete.

Double-Entry System

An accounting system where each transaction is entered twice, as a debit in one account and a credit in another, to ensure the accounting equation is always balanced.