Jimmy Industries Inc The Company Sold One-Half of the Units It Produced

question 65

Multiple Choice

Jimmy Industries Inc.reported the following information about the production and sale of its only product during the first month of operations:
$\begin{array}{ll}\text { Selling price per unit } & \$ 65,00 \\\text { Sales } & \$ 78,000 \\\text { Direct materials used } & \$ 25,000 \\\text { Direct labor } & \$ 42,000 \\\text { Variable factory overhead } & \$ 17,000 \\\text { Fixed factory overhead } & ? \\\text { Variable selling and administrative expenses } & \$ 3,000 \\\text { Fixed selling and administrative expenses } & \$ 5,000 \\\text { Gross profit } & \$ 30,000 \\\text { Production volume variance } & 0\end{array}$
The company sold one-half of the units it produced.The company uses absorption costing.Fixed factory overhead costs included in the ending inventory of finished goods are ________.

• A) 0
• B) $6,000
• C) $8,400
• D) $12,000

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Definitions:

Effort Justification

The phenomenon where people attribute greater value to outcomes they had to put effort into achieving.

Cognitive Dissonance

The mental discomfort experienced by an individual who holds two or more contradictory beliefs, ideas, or values at the same time.

Psychological Discomfort

Describes a state of emotional unease or distress often triggered by stressful situations, conflicts, or challenging thoughts and beliefs.

Painful Religious Ritual

A ceremonial act within some religions that involves enduring pain or discomfort, often seen as a form of spiritual discipline, devotion, or purification.