Sutherland,Inc There Are No Beginning Inventories

question 97

Multiple Choice

Sutherland,Inc.reports the following information: $\begin{array}{|l|r|l|}\hline \text{Units produced} & { 580}&\text{ units } \\\hline \text { Units sold } & 470 &\text { units } \\\hline \text { Sales price } & \$ 200 &\text { per unit } \\\hline \text { Direct materials } & { \$29}&\text{ per unit } \\\hline \text { Direct labor } & \$ 8 &\text { per unit } \\\hline \text { Variable manufacturing overhead } & { \$13 }& \text{per unit } \\\hline \text { Fixed manufacturing overhead } & \$ 16,600 &\text {per year } \\\hline \text { Variable selling and administrative costs } & \$ 6& \text { per unit } \\\hline \text { Fixed selling and administrative costs } & \$ 14,000 &\text { per year }\\\hline\end{array}$ There are no beginning inventories.What is the ending balance in Finished Goods Inventory using absorption costing? (Round any intermediate calculations to the nearest cent,and your final answer to the nearest dollar.)

• A)$7218
• B)$3148
• C)$5500
• D)$8648

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Definitions:

Direct Labour

The wages paid to workers directly involved in the production of goods or services.

Labour Efficiency Variance

The difference between the budgeted or standard labor hours expected for production and the actual labor hours used.

Standard Labour Hours

The number of labor hours predetermined as necessary to complete a job or task under normal conditions.

Actual Labour Hours

The actual amount of labor time spent on a particular job or task, measured in hours.