Iagan,IncHas Collected the Following Data What Is the Ending Balance in Finished Goods Inventory Using

question 65

Multiple Choice

Iagan,Inc.has collected the following data.(There are no beginning inventories.) $\begin{array}{|l|r|l|}\hline \text { Units produced } & 600 &\text { units } \\\hline \text { Sales price } & \$ 120 &\text { per unit } \\\hline \text { Direct materials } & { \$30}& \text{ per unit } \\\hline \text { Direct labor } & { \$10}&\text { per unit } \\\hline \text { Variable manufacturing overhead } & \$ 7 &\text { per unit } \\\hline \text { Fixed manufacturing overhead } & \$ 17,900& \text { per year } \\\hline \text { Variable selling and administrative costs } & { \$4 }& \text{per unit } \\\hline \text { Fixed selling and administrative costs } & \$ 10,600 &\text {per year } \\\hline\end{array}$ What is the ending balance in Finished Goods Inventory using variable costing if 500 units are sold?

• A)$4000
• B)$4700
• C)$1700
• D)$3000

---

Definitions:

Interest Charges

Costs incurred for borrowing money, calculated as a percentage of the principal amount loaned.

Account Payable

An obligation of a company to pay a short-term debt to its creditors or suppliers.

Deductions

Amounts subtracted from gross income or revenue to calculate net income or taxable income, including expenses, allowances, and discounts.

Employee Receivables

Amounts owed to a company by its employees, often due to overpayment or advancements.