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

question 113

Multiple Choice

Use the information below to answer the following question(s) .Hollywood North Magic, a cosmetic manufacturer, began operations in January.During the first month of operations, $60,000 was incurred for direct materials and $80,000 was incurred for conversion costs.During January, 30,000 litres of cosmetics were started and 6,000 litres were unfinished at the end of the month.Ending work-in-process was 45% completed.All inputs are added evenly throughout the production process.
-Bag Company had a beginning inventory of 4,000 bags with costs of $18,000 on January 1.The direct materials were complete and all overhead had been assigned; however, only 40 percent of direct manufacturing labour was added in the prior period.Another 20,000 units were started and completed during the current period.Bag Company uses FIFO process-costing and calculated equivalent unit costs as follows: materials, $8.00; labour, $9.00; and overhead, $5.00.What is the total cost of goods transferred out using the FIFO method?

• A)$440,000
• B)$468,000
• C)$470,000
• D)$491,600
• E)$519,500

---

Definitions:

Interest Rate

The cost of borrowing money or the return on investment, usually expressed as a percentage of the principal amount per period of time.

Borrower's Payment

The amount of money paid by a borrower, typically on a regular schedule, to repay or service a debt.

Interest Rate

The proportion of a total amount of money that is levied for borrowing it, typically expressed on an annual basis.

Future Value

The value of a current asset at a specified date in the future based on an assumed rate of growth.