T-Accounts for the Inventory Accounts of the Arturo Manufacturing Company

question 83

Multiple Choice

T-accounts for the inventory accounts of the Arturo Manufacturing Company are shown below. This data represents transactions for the year of 2012. Based on the data shown here, what was the amount of the cost of goods manufactured?

• A)$607,000
• B)$192,000
• C)$28,000
• D)$591,000

---

Definitions:

Sales Value

The total revenue attained from goods or services sold, calculated by multiplying the selling price by the number of units sold.

Absorption Costing

A costing method where all manufacturing costs, both fixed and variable, are allocated to products, thus "absorbing" them into the cost of goods sold.

Markup

The supplementary amount factored into the base price of goods to address fixed costs and earnings, influencing their final selling point.

Selling Price

The price a consumer disburses to obtain a product or service from a merchant.