At the End of Last Year,Lee Company Had 30,000 Units

question 108

Multiple Choice

At the end of last year,Lee Company had 30,000 units in its ending inventory.Every year,Lee Company's variable production costs are $10 per unit,and its fixed manufacturing overhead costs are $5 per unit.The company's operating income for the year was $12,000 higher under variable costing than under absorption costing.Given these facts,what must have been the number of units of product in inventory at the beginning of the year?

• A) 27,600 units.
• B) 28,800 units.
• C) 32,400 units.
• D) 42,000 units.

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Definitions:

Manual System

An information processing system that utilizes physical means such as pen and paper rather than computerized methods.

Internet Use

The act of utilizing the Internet for a variety of activities, including communication, research, entertainment, and business operations.

Supply Chain Management

The management of the flow of goods and services, involving the movement and storage of raw materials, of work-in-process inventory, and of finished goods from point of origin to point of consumption.

Regulatory Compliance Management

The ongoing process of monitoring and evaluating compliance with relevant laws, regulations, and industry standards.